Free Lunch by David Cay Johnston Page A

investment in education, not to mention the toll such disruption is likely to take on individuals, families,
our sense of the future and ourselves, and perhaps even the domestic tranquillity we have taken for granted for so many
decades.
    â€œThe balance is shifting against us,” Blinder asserted about jobs moving overseas.
“If you look backward you see low-skill, drudgery work like call centers. If you look forward you see a lot of professional work like
accountancy” going overseas.
    Trade, he concluded, is no longer confined to products you
can ship in a box, from automobiles to zithers. It now extends to any service that can be performed electronically. We are, Blinder
wrote in Foreign Affairs magazine, at the beginning of the third industrial revolution. It
might better be called the Triumph of Global Capital over Jobs Revolution.
    The first industrial
revolution was the great movement from farm to factory that began right after Adam Smith’s time, as industrialization and the ability
to manufacture identical products on a mass scale created both vast new wealth and a lot of the misery that Charles Dickens
chronicled. Back in 1810, more than 80 percent of Americans lived and worked on farms, a figure that has dwindled to little more
than 1 percent today, Blinder noted.
    The second industrial revolution began in the middle of
the twentieth century as services began to supplant the making of things. Today less than a sixth of jobs are in manufacturing,
while services provides roughly the same share of jobs that farming did in 1810, as Blinder wrote.
    Blinder says we are in the early stages of the third revolution, one he calls the information age. “The cheap
and easy flow of information around the globe has vastly expanded the scope of tradable services, and there is much more to
come,” Blinder wrote. “Industrial revolutions are big deals. And just like the previous two, the third industrial revolution will require
vast and unsettling adjustments in the way Americans and residents of other developed countries work, live, and educate their
children.”
    Blinder believes that direct service jobs, such as making beds in hotels, must by
their nature stay in America. But even some jobs we may think of as direct service are already at risk or may become so as
technology advances. At the Hilton, you can get your room key from a kiosk, reducing the need for front desk clerks. Radiologists
have already begun to see the reading of X-rays move offshore. Blinder said he thinks most physicians’ jobs are safe, but a look at
technology journals reveals that doctors have done surgeries with remote robotics, so one day residents of Boston may be
operated on by doctors in Beijing.
    There are reputable economists who say Blinder is dead
wrong about tens of millions of existing jobs being at risk. Blinder himself says that fewer than half of the jobs at risk will actually
migrate offshore. And even those who agree with him expect new economic demands to create new jobs. After all, in the sixties,
there was a fear that computers would automate so many functions that by today many millions would be out of work. Instead,
computers created new, and often interesting, work opportunities. And the digital economy has had the curious effect of increasing
demand for paper, ink, and file cabinets. Still, just 15 million jobs going offshore would mean 10 percent of the jobs now in America
would migrate.
    The first two jobs revolutions had in common one trait—people of average or
even below-average intelligence could do many of the jobs with no more than a high school education. Will that be true in the
digital, high tech third wave? And if it is not, what will be the consequences of living in a society where the brightest and hardest
working are rewarded and almost everyone else is reduced to servant-level jobs and wages?
    Among leading economists, the belief is nearly