PublicAffairs
Review by Walter Cummins
It’s a common assumption that the technological inventions and innovations of recent centuries have increased wealth and living standards throughout the world. As a reality check, Acemoglu and Johnson, winners of the 2024 Nobel Prize for Economics, have accumulated data that reveal these technologies have also resulted in the sufferings of workers at the bottom end of the income scale. Those at the upper levels abuse them to bring about greater profits. The song would have it right—”the rich get rich and the poor get poorer,” or at least receive no benefit from the technology. The authors document that there’s nothing surer.
While the book’s subtitle refers to one-thousand years, most of the evidence focuses on more recent times, with an emphasis on Britain and America. Inventions usually celebrated for their ability to increase productivity and profits succeeded by inflicting severe pains on the lives of many thousands. Those workers, in effect, often became functional extensions of the machines.
The authors demonstrate how the powerful steam engines of Victorian England enabled the construction of large factories for massive output of goods distributed to a world market, resulting in new wealth for those who owned the factories. Workers who in previous generations literarily engaged in cottage industry, turning out piece work in their homes, now were regimented into factory roles for fixed hours from morning till evening. For these jobs, eventually the only ones available, they had to relocate to crowded slums in newly expanding cities, all because of the invention of stream engines that powered the factory machines. In the middle of the eighteenth century workers averaged 2,760 labor hours a year. As factories took over, the amount had increased to 3,366, with no increase in income and much greater damage to their health.
Beyond the physical and mental sufferings of adults, children as young as six were vital in the factories because of the tight spaces of the crowded machinery. Only small children could fit for tasks that allowed those machines to keep functioning throughout the long hours of the production day. Children of the same age were placed in coal mines, squeezing through narrow tunnels to help produce the fuel for the steam engines. At one point, twenty to forty percent of coal mine workers were children.
Those in charge were aware of this abuse and resisted pressures to end or reduce child labor. England’s 1842 Report of the Royal Commission of Inquiry into Children’s Employment upset many. But this directive for bringing about relief shows where those in power placed their goals and values. “In other words, even if the gains for children of a new policy were substantial—for example, because of improved health and schooling—this policy should not be adopted if the losses for the employer, primarily in terms of profits, were larger.”
While today child labor is forbidden in England, though still not in large areas of the world, the same priority is given profits. Acemoglu and Johnson cite the economic theory of Milton Friedman at the University of Chicago, who argued that “The social responsibility of business is to increase its profits.” This standard still dominates, with an emphasis on paying workers as little as possible.
This control explains the “power” aspects of the book’s title. Those who enjoy power in society, usually through their wealth, manipulate the system to increase that wealth through their dominance over those who work for them: “Power is about the ability of an individual or group to achieve explicit or implicit objectives.” In some situations it’s coercion, in others persuasion.
Yet the privileged often take their influence for granted. Twenty years of studies by social psychologist Dacher Keltner at UC Berkeley have shown that the more powerful people become the more likely they are to act selfishly and ignore the effects of the consequences on others. For example, drivers of expensive cars are much more likely to dominate on the road than those of inexpensive, cutting off other cars and pedestrians almost half the time. Higher social-status people, according to Keltner, are more likely to cheat and engage in unethical behavior.
Such an attitude helps to explain the denial of the benefits of new technologies to many of the people who work with them. Owners and shareholder become the winners. As a result, since technological developments are inevitable, deliberate efforts would be necessary to assure that their products and services are actually delivered in a way that benefit all people, not just those at the top of the social-economic hierarchy. However, many technologies of the past thousand years have brought about deterioration of conditions for workers.
In the book’s concluding sections, Acemoglu and Johnson present plans to enable the benefits of new technologies to spread to all workers and improve their lives. They explain how such results were achieved in the last half of the nineteenth century in Britain and the United States but warn that some of these achievements resulted in greater worker mistreatment in India. Still, they cite the strategies of the Progressives of the late nineteenth and early twentieth centuries to show that betterment is possible with the right strategies. At the heart of their proposals lay methods for empowering workers. Such achievements would depend on the ability to overcome the present powers of those now controlling the implementations of new technologies, with AI as the immediate concern. From all the evidence of past behaviors that won’t be easy. It’s likely to be another matter of “There’s nothing surer.”
