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Automation, HFT and the "Luddite Fallacy"

story © Michael Betancourt | published October 2, 2011 | permalink | TwitThis Digg Facebook StumbleUpon  |  


The nineteenth century protestant work ethic is the conceptual starting point for the development of a new ideology of automation that merges the nineteenth century ideology of autonomous achievement with digital technology to eliminate human labor from production, apparently rendering human agency obsolete for the generation of value in the digital information economy.

This configuration has its origins in the nineteenth century ideology of autonomous achievement described by T. Jackson Lears in his study No Place of Grace, (which describes how it was used as justification the economic exploitation of labor and the social position of the economically powerful upper classes during the nineteenth century). The proposition that increased, automated production does not displace human laborwhat is sometimes termed the Luddite fallacyis a reflection of the ideology of automation in action: that increased mechanical productivity inherently increases worker productivity thus lowering costs of production and product. At the same time, the off-shoring or shifting of labor to exploit lower costs was common within the United States in the nineteenth century; contemporary off-shoring is inevitable in this construct. This emergent ideology of automation is revealed by a transformation of labor to autonomous production, displacing human labor entirely, a shifting the role of human action from production to consumption.

However, off-shoring labor is only a symptom of these transformations: digital capitalism has enabled a separation of human agency from production: the progression from direct hand-working to machine tools reaches its apogee with the Fordist assembly line where production is subject to a semiotic fragmentation into discrete units, independent of each others. The assembly line makes the role of human action clear, since even in the separation of productive tasks from both the unifying design conception and each otherthe need for human engagement in the production itself remains. This manual element, the action, cannot be fully converted to commodity because of the need to employ human labor (with all the direct limitations labor entails). Automation offers an illusory elision of the limits posed by the human labor: with automation, the necessary link between the intention and the labor which realizes that intent in production is apparently severed; this is the ideology of automationthe breach between human intention and its active engagement in/as production. The expansion of this automation to non-physical production is implicit in how digital technology has been deployed.

The shift of intellectual labor to commodity as immaterial productionincluding both education and creativityreveals the ideology of automation in action. This transformation comes as a result of the same computer technologies that make the off-shoring of knowledge workers labor economically viable: the movement of immaterial labor follows the established, globalized paradigm that shifted physical production from the United States to countries where wages are lower as improved, low-cost communications technologies become commonplace. Automation of intellectual labor depends on digital technologies. Their relationship is circular: without digital communications technology, the emergence of immaterial production would be prevented by an inherent latency in communicationthe manual aspects of human facture impose a lapse in production inherent to the breakdown of the process into component parts performed as individual actions by discrete individualsthe human part of labor. As technologies improve due to the success of immaterial labor, it becomes easier to shift the site where labor is performed on a global scale. Improved technologies imply an increased instability and uncertainty for labor, (both physical and immaterial), demonstrating the incompatibility between the values produced by immaterial and physical production. The extractive, semiotic nature of immaterial production reflects the movement from the social production of human society to autonomous production. It is a productive metaphor: that intellectual action can be physically contained, compartmentally broken into modular pieces, and thus (via automation) made subject to a replacement with digital technology without consequent human social displacements and impactsthe ideology of automation in action.

Autonomous laborthat performed by machines, whether through automated processes algorithmically driven (as with High Frequency Trading software), through generative systems, or physically in the robot assembly lineposes unanswered questions about the historical categories of labor, value, and production since the social reproduction costs of automation are vastly different in degree and character than those of living, human social reproduction. The problem posed by the labor of machines is entangled with cultural, historical, and aesthetic assessments in which the machine does not fit established, traditional conceptual mappings of human society. Thus, the newly autonomous labor results in peculiar appropriations and transfigurations of the machine in relation to human society. A central issue to this entanglement is the inability of Marxian theory to accommodate the meaning of machine labor within conventional analytics, a problematic issue resting on the differences in industrialization and the concept of machine that lie between the nineteenth and the twenty-first centuries. The disappearance of the historical Luddites from contemporary digital production reflects this basic change: the view that machines, including computers, are not a challenge to human labor has become an axiomatic belief about machinery. Instead, the worry that machines will colonize the body had a currency at the end of the twentieth century, as the Critical Art Ensembles comments in Electronic Civil Disobedience made clear in 1996:

Although technological development causes many people fear and anxiety, fewer and fewer believe that technology will replace them. In fact, the fear is really quite the opposite. As technology attaches itself to the body, the relationship between the body and technology becomes increasingly symbiotic.
[Critical Art Ensemble. Electronic Civil Disobedience and Other Unpopular Ideas (Brooklyn: Autonomedia, 1996) p. 59; essay was originally published in 1995.]

In the general failure to acknowledge the potential of computers to automate cognitive tasks, (any intellectual activity that can be reduced to particular rules can be expressed in equations; HFT is a prime example of this transfer), the threat to human exceptionalism is sublimated as fears about digital technology colonizing the organic, human realm: the idea that humanity must merge with computers to enable them to begin thinking. If computers do not need to merge with humanity in such a fashion, then humanity is not exceptionalopening the possibility for (at least some portions of) human intellectual labor being rendered obsolete, as HFT does with the decision making process for stock and commodity trades in the financial markets. Thus, the ideology of autonomous achievement embraced by the middle classes has an ironic character: by working to create computer systems that emulate or replace human agency, the ideology of autonomous achievement becomes the reality of automated achievement for the upper classes, leaving the remainder of society to work as consumers, automation effectively eliminating human labor from the production process. HFT is one sign of this ideology of automation coming into actiona procedure that removes human agency from their historical role in immaterial productionthe response time of the computer system is such that only machines can compete in a market where price fluctuations determined in microseconds make the difference between profit and loss.


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