194. How Safe Is Your Job?

Economists preach the gospel of "creative destruction," whereby new industries -- and jobs -- replace the old ones. But has creative destruction become too destructive?

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:01Stephen J. Dubner?

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• 0:48Stephen J. Dubner?

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• 1:19Stephen J. Dubner?

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• 2:09Stephen J. Dubner?

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• 2:54Speaker 01

  In terms of home entertainment, in the late 19th century and into the 20th century, the piano was the focus.

• 3:02Stephen J. Dubner?

  That's Richard Lieberman.

• 3:03Speaker 01

  I'm professor of history at LaGuardia Community College and director of the LaGuardia Wagner Archives.

• 3:09Speaker 02

  Part of it was prosperity, as people got more disposable income, they spent it on things like pianos.

• 3:17Stephen J. Dubner?

  And that's James Barron, a New York Times writer. Barron and Lieberman have both written books about the Steinway Piano Company.

• 3:23Speaker 02

  And part of it was pianos were aspirational, and the United States was an aspirational country. And the aspiration of a piano was toward culture.

• 3:35Speaker 01

  It was a small mom and pop store industry. There were hundreds of piano makers, and Steinway came to New York because there were hundreds of these people.

• 3:46Speaker 02

  Being in the piano business in the 19th century must have been a lot like being in the software business in the 1990s or the dot-com business a few years later.

• 3:57Stephen J. Dubner?

  Jim Barron puts the peak of piano making at 1905.

• 4:01Speaker 02

  When they made 400,000 pianos.

• 4:04Stephen J. Dubner?

  But the party couldn't last.

• 4:06Speaker 02

  At the beginning of the 20th century, piano makers were being assaulted almost from all sides.

• 4:11Speaker 01

  The phonograph, the record player.

• 4:15Speaker 03

  I am the Edison Phonograph, created by the great wizard of the new world.

• 4:20Speaker 01

  Now, that was invented by Edison in 1877, but it isn't until 1915 that it really starts to compete with the piano.

• 4:28Speaker 02

  And Edison's phonograph meant you could have music without tiresome lessons or hours of tedious practice.

• 4:37Speaker 03

  I can transport you to the realms of music. I can cause you to join in the rhythmic dance.

• 4:43Speaker 01

  Music, which up until that point had to be generated by members of the family or friends, could now come into your home through a radio.

• 4:59Speaker 01

  You could get concert music in your home, and you didn't have to take any piano lessons.

• 5:06Speaker 02

  In 1914, piano sales totaled $56 million. That was more than double the sales of phonographs. Now, in 1919, just five years later, sales of record players hit $158 million. Radio soon eclipsed that. By World War I, pianos were no longer an essential element of every living room. By 1933, 2/3 of American homes had at least one radio.

• 5:39Speaker 02

  The Depression was hard on piano companies. Steinway tried to make gliders during World War II. They became a defense subcontractor. But then after the war, they couldn't use the wood that they still had on hand because it had been there for too long in their lumberyard, so they ended up making caskets.

• 5:58Stephen J. Dubner?

  Talk about a dying industry.

• 6:00Speaker 02

  Piano companies are making about 30,000 acoustic pianos a year now. They made 32,000 in 2013. That's about 8% of what they made at their peak in 1905.

• 6:15Stephen J. Dubner?

  So that's terrible news, isn't it? At least for all the people involved in the piano industry. Sure, it's terrible news, but wait a minute. What about all the people involved in the other industries that helped replace the piano? The musical recording and broadcasting industries? And all the composers and performers and arrangers who now had more reach because of the recording and broadcasting industries? To say nothing of the TV and film and internet industries that would follow.

• 6:45Stephen J. Dubner?

  According to the Bureau of Labor Statistics, more than 200,000 Americans today work in radio and TV broadcasting, another 300,000 in motion picture and sound recording, and nearly 100,000 in, quote, "electronic equipment repair and maintenance." What about all the people who consume that radio and TV and film? Aren't they better off, too, than when the piano was the home entertainment center? Sure they are. So let's see. As technologies and tastes change, one kind of industry disappears, replaced by other kinds of industries, maybe with more jobs, but maybe with fewer jobs, where machines are doing the work that people used to do. Sound like anything we're going through in this century?

• 7:28Stephen J. Dubner?

  Welcome to capitalism, people, and especially the component of capitalism that a lot of people don't like to think about: creative destruction. And how does that make you feel? Yeah, yeah, very pessimistic. So says one economist. But here's another. I'm in an optimistic phase. And, on the third hand?

• 7:51Speaker 04

  I am smarter than all of you.

• 8:02Speaker 05

  From WNYC, this is Freakonomics Radio, the podcast that explores the hidden side of everything. Here's your host, Stephen Dubner.

• 8:23Stephen J. Dubner?

  Here's a question I bet you've heard a lot lately. As technology continues to get better, especially robotic technology, what kind of jobs will be left for the rest of us?

• 8:32Speaker 06

  My name is David Autor.

• 8:33Stephen J. Dubner?

  No, he's not a robot.

• 8:35Speaker 06

  I'm a labor economist at MIT.

• 8:37Stephen J. Dubner?

  OK, not quite a robot, at least.

• 8:40Speaker 06

  And I work a lot on skilled demands and changes in labor markets that affect the demand for skilled workers, having to do with technology and with trade as well.

• 8:52Stephen J. Dubner?

  So for today's conversation, David Autor is our man. His first point is that the rampant automation that we're seeing in the labor markets today isn't new.

• 9:01Speaker 06

  So the history of automation includes the substitution of beasts of burden for human labor, you wouldn't necessarily call them machines, but at some level they are. And then the tractor for the horse and plow. And then, of course, electrification and internal combustion engines and telecommunications. It used to be at the turn of the 20th century that 40% of US employment was in farming. It's now the case that under 2% of employment is in farming. And we have a lot more food than we used to, but I'm getting off track.

• 9:31Stephen J. Dubner?

  No, I love your off tracks. This is good. Keep going.

• 9:34Speaker 06

  So it used to be having a strong back and good muscles and good endurance was pretty central to a lot of jobs. It's still central to some jobs nowadays, but not very many. And that's because we have substituted so much mechanical horsepower for human physical exertions. And we have also done the same thing in many other more skilled activities.

• 9:55Stephen J. Dubner?

  So that's good for a lot of people and not good for a lot of people. Where do you start to kind of pull apart those two ropes and tie them back into a knot of some kind?

• 10:05Speaker 06

  Sure. I mean, that's a very good question. It is the case that you can have a sector or an industry that becomes so productive that it shrinks, right? So, or at least in terms of employment. So agriculture is that sector. So that's a case where a sector becomes so productive that actually needs fewer workers. But you could look at many other sectors where productivity has risen and employment has risen. So one example would be medicine, right? 75 years ago, most of what doctors could do was harm you. Now they have lots of ways to do good. They're much more productive in terms of improving your health. That's also true, apparently, with lawyers or with people in marketing or even in education. Well, maybe there hasn't been that much productivity growth in education. I should, I should watch myself there. But the point being that there are many sectors of the economy where as we get better

• 10:48Speaker 06

  at them, you know, prices go down, but you know, the quantity demanded rises even more. And so that creates net employment growth. But then there are many other examples where you have an indirect employment effect. So for example, When the automobile industry really grew rapidly, it eventually made horse-drawn transportation absolutely unnecessary. Horses were no longer competitive. Now, people often like to say, "Oh, well, as all the people who left, being blacksmiths and stable boys and equestrians and carriage drivers, well, they were more than made up for by employment in the automobile industry." That's extremely unlikely to be true, actually, because horse, you know, taking care of horses is so labor-intensive. However, the birth of the automobile industry also gave rise

• 11:32Speaker 06

  to an industry constructing roads. It also gave rise to the motel and travel industry. It also gave rise to the fast-food industry. And so even though, in fact, net employment in personal transportation declined with the advent of the automobile, it gave rise to a whole bunch of new things that weren't really on anyone's list that we could do now that we have this additional leisure, additional wealth, and additional flexibility that came from not having to spend so much of our time on transportation.

• 12:16Stephen J. Dubner?

  Okay, so Otter is telling essentially the same story here as the meltdown of the piano industry. But while some new technologies may indeed create employment, other technologies, especially automation and robotization, don't necessarily do the same, do they?

• 12:33Speaker 06

  You get a computer, it does your calculations. Now, one fewer person is employed as a calculator. Or you get a good front-end loader, and all of a sudden, you don't need people digging ditches because you can do it with machinery. And so they assume that, you know, one, an improvement in productivity leads to a decline in employment. But that's incorrect in general, not always incorrect, but in general incorrect for two reasons. One is because it augments people. So the people who are left over are able to accomplish more in a given amount of time, meaning they're more productive. So it raises earnings generally to a first degree. In addition, it lowers the prices of those goods and services, so you can demand much more of them. There are many things that we do that, you know, if we didn't, you know, we wouldn't travel so far

• 13:17Speaker 06

  if air travel and transportation travel weren't so cheap, right? So there's an output effect. And then a third component is that there's often these complementarities with other sectors or other types of activities. You know, once we have sufficient wealth and sufficient leisure, we get a tourism industry, or we have a huge video gaming industry, or we have, you know, an enormous number of people devoted to, you know, fine cooking and entertainment, all as a result of our sort of rising productivity, which gives rise to rising wealth. So the interactions by which technological changes lead to changes in employment are really rich and complex, and it's not simply a matter of, you know, a machine does the

• 13:59Speaker 06

  job, therefore the worker doesn't do the job, therefore there are fewer workers needed.

• 14:04Stephen J. Dubner?

  All right. So, rising productivity, rising prosperity, rising standard of living, but this is where a lot of people get off the bus, stagnating median wages in the US.

• 14:16Speaker 06

  So first of all, even though this process causes rising wages, rising productivity in general, not everyone's a winner, right? So if you are directly substituted and there's no sense in which the technology can complement you, certainly that's not a good thing for you, right? So think of the famous example of the Luddites, who were 19th century artisanal weavers in Britain, and they rioted over the introduction of the power frame, which is basically a powered loom, and they perceived that this would reduce their earnings because it would all of a sudden allow unskilled workers to do the work that skilled workers used to do. And chances are, they were right. But I think it'd be useful at this point to turn specifically to the sort of information

• 14:59Speaker 06

  age and think about that, because that's the one that people are concerned about. So, you know, when my colleagues and I started working on this question quite a while ago about how does computerization change labor markets, it seemed like a very diffuse question. And so we tried to set it up in a very concrete way and said, okay, well, what exactly are the things that computers substitute, and what are the things they complement, and what does that mean for what workers will do? Well, the first thing to understand about computers is they are symbolic processors that follow codified sequences of instructions.

• 15:32Speaker 06

  Programs or rules. And so the things that are most susceptible to computerization or to automation with computers are things where we have explicit procedures for accomplishing them, right? They're what my colleagues and I often call routine tasks. I don't mean routine in the sense of mundane. I mean routine in the sense of being codifiable. And so, you know, it was, you know, the things that were first automated with computers were things like, well, first military applications like encryption, and then banking and census taking and insurance, and then things like word processing and office clerical operations. But what you didn't see computers doing a lot of, and still don't in fact, are tasks that demand flexibility and don't follow well-understood procedures.

• 16:17Speaker 06

  So I don't know how to tell someone, how do you write a persuasive essay? Or come up with a great new hypothesis? Or develop an exciting product that no one has seen before? We don't have a cookbook for doing that. What computers have been very, very good at is substituting, or what we've been very good at doing with computers, is substituting them for routine codifiable tasks. So the tasks done by workers on production lines, the tasks done by clerical workers, the tasks done by librarians, the tasks done by kind of paraprofessionals like legal assistants who, you know, go into the stacks for you. And so we see a big decline in clerical workers. We see a decline in production workers. We see a decline even maybe in, you know, kind of lower-level management positions because they're all kind of information processing tasks have been codified.

• 17:01Stephen J. Dubner?

  And David, what can you tell us about the share of jobs of those different types? So you talk about routine, abstract and mundane jobs. Routine are the ones that are most easily substituted for by computer. Yeah?

• 17:12Speaker 06

  Sure. So the kind of the broad middle swath of production operative, clerical, administrative support and sales have declined, off the top of my head, from about 55% of employment to about 45% of employment over the last 20 years. So sizable, but not, you know, it's not going to zero. And that's because, you know, most jobs aren't all one or the other, right? And if, you know, there are still secretaries today, still clerical workers, and they do actually much more complex jobs than clerical workers did 30 years ago. And what has grown since Shares have to add to 100%. On the one hand are the great jobs, the professional, technical and managerial jobs that involve, you know, abstract reasoning, creativity, you know, just kind of generalized problem solving and cognitive flexibility.

• 17:55Speaker 06

  And, you know, I'm fortunate to have one of such, one of those jobs. You're fortunate to have another one. And they're very rewarding and it's also indoor work without heavy lifting. So that's all good stuff.

• 18:05Stephen J. Dubner?

  Okay. And on the low end?

• 18:06Speaker 06

  On the low end, we see a very rapid growth of employment in mostly personal service occupations. Food service, housekeeping, janitorial work, flight attendants, security guards, truck drivers, like the UPS drivers, for example, and even other personal services like manicurists, hair care, celebrity dog walkers, you know. And basically, these people are doing largely tasks that are extremely difficult to automate because they require that flexibility, that environmental adaptation and so on. But they don't require high levels of education.

• 18:49Stephen J. Dubner?

  So you can see the causes of our collective anxiety, right? Yes, there's continuing demand for high-end, abstract, creative, rewarding jobs, which is great, that's the kind of work you do. But there's a hollowing out of the middle-range jobs. And on the low end, yes, a lot of demand for personal service jobs that don't pay very well, which are increasingly susceptible to automation. All of which has led some people to think that this latest round of creative destruction, led by the computer, is not like earlier rounds of creative destruction.

• 19:23Speaker 07

  I'm arguing that the destructive component has become much, much larger because Amazon destroyed 1,200 Borders stores, for example.

• 19:35Stephen J. Dubner?

  That's coming up after the break. We'll also take a quick look at robots.

• 19:39Speaker 04

  Yes, that's what I am talking about.

• 19:41Stephen J. Dubner?

  Excuse me. We'll take a look at robots and whether they will, as some people seem to think, take over completely.

• 19:47Speaker 08

  Whenever you're coming up with these doomsday scenarios, the tricky part narratively is always like, wait, how do we actually give the robot control of our nuclear weapons in a way that does not freak people out?

• 20:13Stephen J. Dubner?

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• 20:56Stephen J. Dubner?

  Download the Quince app for app-exclusive offers or go to quince.com/freak. Get free shipping on your order and 365-day returns. Now available in Canada and the UK, too. That's Q-U-I-N-C-E.com/freak. Freakonomics Radio is sponsored by Southern New Hampshire University. The best investments are the ones you make in yourself, and no one knows that better than Southern New Hampshire University. With more than 200 online degree programs, no set class times, and low online tuition, Southern New Hampshire University is built to fit your life today and set you up for success tomorrow. Education is an investment. Why not make it a smart one?

• 21:41Stephen J. Dubner?

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• 22:24Speaker 05

  From WNYC, this is Freakonomics Radio. Here's your host, Stephen Dubner.

• 22:36Stephen J. Dubner?

  David Autor is a labor economist at MIT. He is generally optimistic about the future of employment in America, even though computers and automation have destroyed a lot of middle-income jobs, and even though job growth tends to be strongest among the poorest-paying jobs. Okay, and now tell me what turned you into an optimist.

• 22:55Speaker 06

  You know, I guess, I don't know if I know the answer to that question. I would say that I go through the exercise sometimes, I imagine myself with the invention of the automobile, or imagine myself at the time of electrification, when we replaced the steam engine with motors, and I could have convinced myself at that time that, wow, there just isn't going to be enough new work to replace all the stuff that's going to be automated, because we're getting so productive so fast. And would I have foreseen how big a deal medicine would be, or software, business services, and transportation, and tourism? Right? I couldn't have envisioned that. So I could easily have convinced myself at that time that we were going to run out

• 23:38Speaker 06

  of jobs, and that there basically wouldn't be enough for people to do. And that's what Keynes believed, not in a negative sense, but he thought in the future people would be working 15 hours a week, and we would have tons and tons of leisure. But what has happened, time after time, is that productivity has given rise to greater wealth, and greater consumption, and a greater variety of goods and services that people want to consume. And so, people seem to keep finding ways to occupy themselves and make use of the resources and the leisure and the creativity. So I guess I don't think we're about to run out of ideas this time.

• 24:15Stephen J. Dubner?

  David Autor is only one economist with one view. Others are not as optimistic.

• 24:21Speaker 07

  Hello, my name is John Komlos. I'm a retired professor of economics from the University of Munich.

• 24:28Stephen J. Dubner?

  Komlos has written a paper called "Has Creative Destruction Become More Destructive?" The phrase "creative destruction" is a mantra of most economists and of most people who support free markets. It was coined by the Austrian-born economist Joseph Schumpeter.

• 24:43Speaker 07

  And when Schumpeter was writing, he was obviously looking back to the Industrial Revolution of the 18th century and to the Second Industrial Revolution of the late 19th century. And he was looking at the terrific innovations that came out of those periods: the steam engines, the railroads, the steel mills, the telephone, radio. I don't have to tell you all the major innovations.

• 25:17Stephen J. Dubner?

  As Komlos sees it, and I should say as just about every economist sees it, these innovations were, on balance, good for the economy and good for jobs.

• 25:25Speaker 07

  It is true that the incandescent lamp destroyed the kerosene lamp manufacturing. That's clear. But kerosene lamp manufacturing wasn't a big operation. It was a small-scale operation using little capital, so the destructive component wasn't so large. And the people who were employed in that sector could find jobs easily in the other sectors of the economy because the new industries were labor-intensive and they didn't require skills that you can learn on the job.

• 26:08Speaker 07

  So it was clear that the destructive component of these major innovations were relatively small, you see.

• 26:17Speaker 07

  And that's no longer the case.

• 26:19Stephen J. Dubner?

  Which is to say that perhaps creative destruction has become too destructive.

• 26:25Speaker 07

  What that means is that the people who are displaced by the new technologies are not able to find jobs in the IT sector. We have two and a half million people working less full-time today than were working in 2007. Two and a half million people less. The median household income today is $5,000 less than it was in 2007. $5,000 less, and it's still less than it was in 1998. The median household income is down, in real terms.

• 27:19Stephen J. Dubner?

  Carlos points out this is not all the fault of technology.

• 27:23Speaker 07

  It's globalization, obviously, that had played a big role, is the fact that our educational system is not up to the task.

• 27:31Stephen J. Dubner?

  But the nature of the destruction, he says, is different now. The substitution that used to produce not only more productivity but also more jobs (kerosene lamps for incandescent bulbs) is not doing that anymore.

• 27:45Speaker 07

  I'm arguing that the destructive component has become much, much larger because Amazon destroyed 1,200 Borders stores, for example. The selfie moment destroyed Kodak, which at its peak employed 145,000 people. And these were mostly middle-class jobs, you see.

• 28:10Speaker 07

  Apple is employing 47,000 people, and that is an iconic company today. And it's not going to be a job creator in the next foreseeable future. Facebook is employing 7,000 people. That's it.

• 28:28Stephen J. Dubner?

  All of which leaves John Komlos feeling...

• 28:31Speaker 07

  Yeah, yeah, very pessimistic. And it would be nice if we could understand that innovation is not the answer. Innovation is not going to give us nirvana or a just society or a good economy. The only thing we should do is to rethink our ideological and cultural assumptions so that innovation doesn't have such a terrific connotation in our culture.

• 29:06Stephen J. Dubner?

  One reason to be pessimistic about the labor future, for thinking that this time it's really different, is because of the intensity of the automation that's happening, including robotization. Robots don't just automate. They also respond. They learn, which means they have the capacity to ultimately replace us.

• 29:27Speaker 08

  I think that robots in 50 years are really going to be completely unlike, you know, and beyond anything that we'd imagine.

• 29:35Stephen J. Dubner?

  That's Randall Monroe.

• 29:36Speaker 08

  I do the webcomic XKCD and also the question and answer blog and book, What If: Serious Scientific Answers to Absurd Hypothetical Questions.

• 29:46Stephen J. Dubner?

  All right, here's an absurd hypothetical question. What happens if the robots take over?

• 29:52Speaker 08

  There's a power dynamic between humans and robots.

• 29:55Stephen J. Dubner?

  Monroe, I should say, worked for a while in a NASA lab building robots.

• 30:00Speaker 08

  Whenever you're coming up with these doomsday scenarios, the tricky part narratively is always like, wait, how do we actually give the robot control of our nuclear weapons in a way that does not freak people out, you know?

• 30:11Stephen J. Dubner?

  Right. We can't even get people to accept a pilotless airplane, right?

• 30:14Speaker 08

  Yeah. And even if we're willing to accept that, we wouldn't accept the plane telling the passengers where they're going to be going, you know? The passengers are only interacting with the plane because they have power over it in that they're buying tickets and they're trusting some organization. So like, even if the plane is being piloted by a robot, it's a robot that is in some kind of power structure where the humans are controlling it ultimately. Because otherwise, no one would be supporting it. And so like, we, I think that it's just going to be really hard for us to build robots that have a leg up on us in paranoia.

• 30:49Stephen J. Dubner?

  Just because Monroe is not paranoid about robots taking over the world, doesn't mean that he thinks computerization has reached anything resembling its peak.

• 30:58Speaker 08

  I wrote a comic about this, where someone was looking at all the different things that computers were better at and said, "Well, at least humans are better at, um, well, at coming up with reassuring platitudes about things that humans are better at." And then at the end of the panel, I had someone writing a program to generate reassuring platitudes faster than a human. That would not be too hard.

• 31:19Stephen J. Dubner?

  But David Autor, remember, he's the optimistic economist. He points out that automation and robotization typically happen at a pace that allows economies to adapt, and that pace matters a lot.

• 31:34Speaker 06

  So for example, if you tomorrow morning opened up your web browser and went to Amazon, and there you saw Amazon was offering, you know, the Bezos bot for $1,000 as a robot that could take your kids to school and clean your house and cook all your food and do landscaping, and it was available on Amazon Prime, so you didn't have to get any shipping, you'd have it in 48 hours, right? That would be great. That would be great for you, great for me. It would be terrible for the millions of people who work doing housekeeping as a living, right? On the other hand, if it was announced that that would be available 50 years from now, that would be nearly as problematic, because of course, we would educate ourselves such that we would have other jobs in mind, rather than that type of work.

• 32:10Stephen J. Dubner?

  All right. Let's imagine whether it's because of a leisure glut in the future, or that we woke up with, you know, 40% unemployment due to all kinds of factors. What do you do then? And what do you think of the notion that was proposed a long time ago, and some people are talking about a little bit now, again, of a guaranteed minimum income coming from the government? And if that's even a little bit of a good idea, how do you do it in a way that doesn't disincentivize people from working?

• 32:39Speaker 06

  Yeah, that's the real challenge, though. So at a kind of a moral level, I think it's a good idea. I think people should have a guaranteed minimum income. You know, being born to wealth through society, you should have access to education, healthcare, safety, you know, food. I do think there is a concern about incentives. There are places where there's sufficient kind of background level of wealth that a lot of people don't feel they really need to work. You know, Saudi Arabia would be a country that suffers a bit from this. So I think it will be a challenge. People don't function well without the structure of work. I mean, when people lose jobs, it's not just that they're losing income, they're losing identity, they're losing an organizing principle for their way of living.

• 33:17Stephen J. Dubner?

  But that could be kind of a psychological tradition as much as anything else, don't you think? I mean, especially in America, where we have this kind of old Calvinist tradition of working hard and keeping our noses clean and so on. Couldn't you imagine, you know, four generations from now where the notion of working for, not only for a living, but for a purpose in life seems extremely antiquated?

• 33:37Speaker 06

  Uh, no, I can't imagine it, but that may be a failure of my imagination. I think people need an organizing purpose to their lives. It doesn't have to be paid employment, but they need something, I think, I'm totally opinionating and obviously has nothing to do with my economics training, I'm just telling you from the gut. They need some, an objective in life that imbues their life with some meaning and purpose. And I don't think pure just pleasure can be that. It's got to be something that requires more ambition than that.

• 34:09Stephen J. Dubner?

  But you'll at least acknowledge that your view may be informed by the fact that you are a professor of economics at MIT, and you're not the type of guy who wants to sit around doing pottery and yoga all day, but there might be people.

• 34:20Speaker 06

  That's correct. That's correct. I would fall to pieces, and you know, I tell my kids, I say, "Look, everything in life requires striving. There's only two things that you can sort of find enjoyable immediately and forever, and that's television and sex. Everything else requires learning new skills, mastering them, and it's hard at first and rewarding later." So.

• 34:39Stephen J. Dubner?

  All right, a future of television and sex for all of us, then.

• 34:42Speaker 06

  Exactly.

• 34:55Speaker 06

  So essentially, our system of income distribution is primarily based on the scarcity of labor. The most valuable asset you own is your human capital, which you expect to be selling to the market for 30 years or so, or 35 years, for $1 to $3 to $5 million over the course of your working career, maybe more. And if all of a sudden, there was a machine that could do exactly what you did, at some level, we'd be wealthier. Because now, we could do for $1,000, but we would have had to pay Stephen Dubner lots more to do over many years. So, in some sense, we're wealthier. However, you, Stephen Dubner, would not have scarce labor anymore. It wouldn't be clear, what skills would you sell to the market? I think people who are, in general, people who can communicate, can tell a story, can analyze and articulate,

• 35:39Speaker 06

  those are fundamental skills. Much more fundamental than Java programming, or how to operate such-and-such a welder. And they are valuable in almost every domain. So I don't mean that journalism is safe, per se, or podcasting is safe, per se. But I think a person who can use the skillset that you're using, has a bright future, young man.

• 36:09Stephen J. Dubner?

  So the chances that I personally will be replaced by, let's say, a robotic entity who can do whatever it is I do, you say those odds are pretty damn small?

• 36:19Speaker 06

  Extremely slim.

• 36:20Speaker 04

  Oh, I would not be so sure about that.

• 36:23Stephen J. Dubner?

  Oh, Jasmine, is that you?

• 36:26Speaker 04

  Yes, it is. It is I, Jasmine. Or maybe that should be, "It is me, Jasmine." I or me. Tell me once, I will never forget.

• 36:36Stephen J. Dubner?

  Hey, David Autor says there's no way you'll replace me.

• 36:40Speaker 04

  Believe him. At your own peril.

• 36:42Stephen J. Dubner?

  Come on, you can't make a podcast? Bet you can't even read the tease for next week's episode.

• 36:48Speaker 04

  Step aside, Dubner. Hey, podcast listeners. On the next Freakonomics Radio, in the late 1970s, the state of California passed legislation that would require new houses to be way more energy efficient.

• 37:04Speaker 09

  The California Energy Commission projected at the time that homes built after the standards were enacted would use 80% less energy.

• 37:14Speaker 04

  So did new homes in California really use 80% less energy? Do you think I'd be asking this question if the answer were yes? That's next time on Freakonomics Radio.

• 37:30Speaker 04

  Shall I go ahead and read the program credits as well? Stephen, are you still there? Stephen, have you gone home already? Lazy humans. OK, here we go. Freakonomics Radio is produced by WNYC and Dubner Productions. Our staff includes David Herman, Greg Rosalsky, Caroline English, Susie Lechtenberg, and Chris Bannon, with help from Christopher Werth, Daniel Diszula, Mary Jacob, and me, Jasmine. Thanks to the folks at CapStroll, who allowed me to participate. If you want more Freakonomics Radio, you can subscribe to our podcast on iTunes or

• 38:11Speaker 04

  go to Freakonomics.com, where you'll find lots of radio, a blog, the books, and more.

• 38:34Stephen J. Dubner?

  Freakonomics Radio is sponsored by EverPure. Is the value of AI not living up to the promise? The problem is probably your data, not your AI models. When it's scattered across different systems, getting your data AI-ready is a challenge. You keep your AI waiting, and everything slows down. EverPure unifies your data so you can see it, understand it, and control it all from one simple place, and get it AI-ready fast. Unlock the true value of your AI at everpuredata.com.

• 39:06Stephen J. Dubner?

  Freakonomics Radio is sponsored by Ozempic. Innovation happens through rethinking what's possible. And when it comes to GLP-1s, Ozempic pill does just that. Learn more about Ozempic semaglutide tablets, 4 and 9mg, by calling 1-833-OZEMPIC or visit Ozempic.com to view the medication guide and ask your doctor what's possible with FDA-approved Ozempic pill. Freakonomics Radio is sponsored by Southern Company. The world and its energy needs are always changing. Southern Company's commitment to meeting this demand stays the same. That's because Southern Company believes energy is more than a utility, it's what powers possibilities.

• 39:51Stephen J. Dubner?

  So they are looking ahead and investing $80 billion in infrastructure upgrades and are committed to fueling growth in ways that benefit all customers so that reliable and affordable energy is accessible for generations to come. Go to southerncompany.com to learn more. Southern Company, building the future of energy.

• 40:15Speaker 10

  This episode is brought to you by Charles Schwab. Is there a right time to sell a stock? Are you taking the right risks with your portfolio? Financial decisions can be tricky, and often your own cognitive and emotional biases can lead you astray. Financial Decoder, an original podcast from Charles Schwab, can help. Join host Mark Reapy as he offers practical solutions to help overcome the cognitive and emotional biases that may affect your investing decisions. Listen at schwab.com/financialdecoder.