cellio | low-end jobs

Automated alternatives to humans in the service industry have been around for a while. ATMs were probably the first widespread case of this. The real value of ATMs was the ability to interact with your bank at times when the bank wouldn't otherwise be available. I think ATMs are a real win for that reason, and the only time I visit humans in my bank is when I want to make a deposit.

More recently, I've interacted with automation that is designed to specifically replace humans rather than broadening service. The automated check-out at grocery stores is the big example here. Instead of one cashier per line, stores now need one employee per 4 or so lines. This isn't making things more convenient for customers; unlike ATMs, the scanners are only available when the store is open anyway.

There are practical reasons I tend to avoid the automated checkouts, mostly related to speed. The line for the human has to be about three times as long as the line for the machine before the machine looks like a time-saver. People may get more proficient at scanning and packing over time, of course.

But I find that even absent that consideration, I'm reluctant to use the machine. Doing so helps to eliminate a low-end job that might be the only job the job-holder is capable of doing. Most of the cashiers I see at the grocery store aren't college-age kids looking for spending money; they're middle-aged and sometimes visibly handicapped.

This is not wholly a compassion-based argument; it's also one of expedience. I think we as a society are better off if almost everyone has a productive job. And some people are only capable of the lower-end jobs that are most in danger of being automated away. (Aside: for this reason, requirements for high minimum wages are also a bad idea -- don't make it cost-ineffective to hire people at prices they're willing to work for!)

We cannot avoid automation, of course, and in many cases it's a good thing. I'm no Luddite (she says, typing on her computer :-) ). But I kind of wish that we could focus it a little differently sometimes.

And yes, sometimes the humans are annoying to deal with. Last night I lost close to ten minutes to an inept cashier, and there is one (mentally challenged) bagger who I will never again allow to touch my groceries because he seems utterly bewildered by ideas like "the bread goes on top" (multiple failures). People who aren't capable of doing the job shouldn't hold the job anyway just out of pity. (Giant Eagle was right to fire the guy who was partially eating food and then putting the package back on the shelf, and I don't care that he didn't understand that this was wrong.) But y'know, the machines aren't painless either -- just try to get a scanning error fixed. And for the most part, the people holding these jobs are quite capable and willing to work, and I find I'm rooting for the people over the machines.

Flat | Top-Level Comments Only

It seems that an insurance company could potentially make a killing (so to speak) by offering coverage against catastrophic loss only, with a significant deductible. You pay for your own checkups and minor ailments, but if you get cancer you're not financially screwed. Rates would be a lot lower than for conventional insurance. It would, of course, appeal primarily to healthy people, drawing people away from the actuarial pools for conventional insurance, thus screwing over everyone else rather more. But that's not the concern of the insurance company making the offer. So I wonder if this has been tried and, if so, what the results were.

Note: I am not saying this would be good; it's just an experiment I'm wondering about.

Careful: a well-designed welfare system is a bit subtler than that. You want them to collect more than just the difference from welfare, or the incentives wind up perverse.

Hmm. Good point.

It seems that an insurance company could potentially make a killing (so to speak) by offering coverage against catastrophic loss only, with a significant deductible.

Nope -- this misses the third part of the problem, which I really should have pointed out explicitly. Insurance-mediated healthcare is a problem. *Employer-funded* insurance-mediated healthcare is a much bigger one.

Remember, by now most of us with serious jobs demand high-end health insurance as a perk of that job. This disconnects us even more dramatically from the actual payment of the healthcare, because we're not even paying the full load. I'm paying, what, probably about a third of the actual cost of my health insurance; the rest is picked up by my employer, which is pretty normal. And it's rare for a company to offer multiple health plans -- the hassle of managing multiple plans just isn't worth it to them.

The result is that there's no good way to introduce competition into this marketplace. Sure, an insurance company can introduce competitive rates, but an employer who uses that plan is going to have much more trouble attracting the best employees. There isn't anyone properly motivated to buy this plan: the high-end companies are forced to buy high-end insurance, the low-end companies don't need to buy *any* insurance, and it's still too expensive for individuals, because the whole system is skewed towards the pricey and inefficient high-end plans.

It's really astonishingly messed-up: you would be hard-pressed to come up with a system of more perverse incentives if you tried. It illustrates nicely that governments aren't the only actors capable of introducing massive friction into a marketplace...

I see your point, though I had been thinking of this as a viable option for, for example, laid-off workers who don't want to pay $600/month for COBRA coverage, and self-employed contractors, and other middle-class-ish folks who don't otherwise have employer-supplied coverage.

And yeah, the insurance business is really messed up now. But the phrase "let the government fix it" rarely inspires confidence, either. :-)

True, but at this point not really a compelling argument. The government would actually be hard-pressed to screw it up worse than it is now.

Mind, I'm not convinced that a purely government-run model is necessarily the best -- I suspect that a well-designed hybrid model would likely be better from my POV. But I *am* pretty sure that what we have right now is the worst. The entire point of capitalism -- really the one truly solid argument for it -- is that it's supposed to be efficient. But in this case, due to perverse incentives, it manages to be *remarkably* inefficient...

Catastrophic health insurance plans *are* available. However, the ones I've seen are tailored for people who don't qualify for conventional insurance, and are thus priced astronomically.

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