Protect yourself by mitigating the effects of globalization and automation.

1. GLOBALIZATION AND AUTOMATION
Risks and Mitigation
By Nathan J. Kerr

2. TWO INFLUENTIAL BOOKS ON SUBJECT
• “The World Is Flat: A Brief History of the Twenty-First Century”
by Thomas L. Friedman
• “The Second Machine Age: Work, Progress, and Prosperity in a
Time of Brilliant Technologies” by MIT professors Andrew
McAfee and Erik Brynjolfsson

3. WHAT ATTITUDE SHOULD WE TAKE
ABOUT THIS PHENOMENON?
• Many will want to take a Luddite attitude
• Luddites were 19th century textile workers following General
Ludd in destroying machinery that threatened their
occupations.

4. POSITIVE OUTCOMES • We now have more power
and abilities in the palm of
our hands than in eight
computers just 15 years ago
• Due to automation,
technology is cheaper. GPS,
Video streaming, etc.
• Automation is beginning to
spur manufacture growth at
home
• Thanks to internet, anyone
ahs a global marketplace

5. RISKS
• Product lifecycle is shorter
• Disruption is constant
• Those unwilling to be fluid
will lose

6. MITIGATION ON MACRO LEVEL
• We must lower our inflated expectations of what is Middle
Class today
• Stagnant wages may actually be a bubble correction from
booms of 1990’s

7. MITIGATIONS MACRO
WELFARE POLICY REFORM
• Must encourage marriage
• Added amounts for marrying phased out
slowly
• Currently threatens stable homes by
threatening handouts as marriage raises
household income
• Incentivize a stay at home parent
(gender neutral) through tax policy
• Studies conclude children with one parent
home are significantly more successful
• Asians (including S.E. Asians) have lowest
divorce/ single parent rates
• Fastest growing minority and rising wealth
• Highest test scores
STEM
• Encourage STEM by tying Pell
grants to favor those areas
• Census reports twice as many
STEM graduates in USA than jobs
SMARTER IMMIGRATION
• 2/3 of new STEM jobs go to guest
workers
• Hinders current citizens and legal
residents employability
• Corporate welfare on right
• Leads to Social welfare
(unemployment) on left

8. MITIGATION (MACRO)
Corporate Responsibility
• Follow Henry Fords advice on pay
• Workers should be able to afford the product they make
• Follow Clayton Christensen's
• Don’t let stockholders determine pay of employees
Smart Wealth Redistribution
• Reward work not number of children
• Raise minimum wage- peg to inflation
• Make minimum wage reflect regional COLA instead of one size fits all
• More efficient to pay directly to the working poor than to tax and
redistribute through an inefficient bureaucracy

9. MITIGATION (MACRO)
Reform Affordable Care Act (aka “Obamacare”
• Eliminate 32 hour rule as basis for insurance
• Encourages part time employment
• Make it one hour or more
• Encourages employing full time
• Eliminate income taxes, forced benefits on
human capital
• Tax equipment and goods
• Currently incentivizes laying off taxable
human capital in favor of tax shielded
automation (That is backwards of
encouraging employment)

10. MITIGATION (PERSONAL)
• Those children not STEM
inclined must be
entrepreneurial
• Those who own will rule
• Those neither STEM nor
entrepreneurial better invest
• As corporations grow off less
labor, stocks allow you to
“own” a piece of the pie
Teach American Children the Art of Delayed Gratification
(Think “Tiger Mom’s” in many Asian communities)
President Obama’s (single) mother woke him daily at 0500 for remedial reading
• Money savings (delay spending)
• Delay partying (study and learn then play later)
• Delay sexual intimacy and child bearing until stable
“Live like no else today, so you can live like no else can tomorrow.”

11. CONCLUSION
• No need to fear future
• Those who prepare can reap the
rewards of automation
• In 1900’s manufacturers worked
average 60 hours per week
• Farmers 80+ hours
• Today 40 hours
• Tomorrow 20 hours?
• Just need better governmental
and personal self control and
discipline

12. REFERENCES
• Adler, M. (2006, July 4). Behind the ever-expanding
American dream house. Retrieved February 24, 2015,
from
http://www.npr.org/templates/story/story.php?storyId=55
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• Andrews, E. (2014, October 20). Eric Bettinger: Why stay-
at-home parents are good for older children. Retrieved
February 23, 2015, from
http://www.gsb.stanford.edu/insights/eric-bettinger-why-
stay-home-parents-are-good-older-children
• Brynjolfsson, E., & McAfee, A. (2014). The second
machine age: Work, progress, and prosperity in a time of
brilliant technologies. New York: Norton &.Co.
• Christensen, C. (2010, July 1). How will you measure your
life? Retrieved February 23, 2015, from
https://hbr.org/2010/07/how-will-you-measure-your-life
• Iceland, J. (2012). Poverty in America a handbook.
Berkeley: University of California Press.
• Jones, S. (2006). Against technology: From the Luddites to
Neo-Luddism. New York: Routledge.
• Kaplan, S. (n.d.). Innovation lifecycles Leveraging market,
technology, and organizational S-curves to drive
breakthrough growth. Retrieved February 26, 2015.
• Katje, C. (2014, June 4). Garmin Ltd. doesn't need car
navigation sales to survive. Retrieved February 22, 2015,
from
http://www.fool.com/investing/general/2014/06/04/gar
min-ltd-doesnt-need-car-navigation-sales-to-sur.aspx
• Kennedy, B. (2014, August 21). Will manufacturing jobs
return to the U.S.? Retrieved February 23, 2015, from
http://www.cbsnews.com/news/will-manufacturing-jobs-
return-to-the-us
• Rotman, D. (2013, June 12). How technology is destroying
jobs. Retrieved February 20, 2015, from
http://www.technologyreview.com/featuredstory/515926
/how-technology-is-destroying-jobs/
• Salzman, H. (2014, September 15). STEM grads are at a
loss: Those who claim there's a STEM skills shortage are
ignoring the evidence. Retrieved February 24, 2015, from
http://www.usnews.com/opinion/articles/2014/09/15/ste
m-graduates-cant-find-jobs
• Wetzstein, M. (2013). Microeconomic theory: Concepts
and connections. (2nd ed.). Hoboken: Taylor and Francis.