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The Boeing 737 Max 8: a Case Study in Uncreative Destruction

Photograph Source LLBG Spotter

On October 29, 2018, a Boeing 737 Max 8 belonging to Lion Air in Indonesia crashed into the Java Sea 12 minutes after take-off. All 189 passengers and crew members were killed instantly. It is extremely unusual for planes to suffer such accidents in clear weather after having reached their cruising altitude. Flight experts concluded that the pilots were not adequately trained in the Maneuvering Characteristics Augmentation System (MCAS), a robotics technology that lowers the nose of a plane to prevent a stall. Although there is no definitive judgement on exactly what happened, it appears to be a combination of inadequate training for the pilots and a malfunctioning MCAS.

On Sunday, another 737 Max 8 owned by Ethiopian Airlines had the same kind of accident resulting in the death of 157 passengers and crew members. In the aftermath of the tragedy, this has led to Australia, China, Germany, France, Indonesia, Ireland, Malaysia, Singapore, and the United Kingdom grounding the planes.

Looking at these two horrible tragedies that will make me think twice about getting on a plane again, I keep thinking of the title of Gabriel Garcia Márquez’s classic “Chronicle of a Death Foretold”. In essence, the use of MCAS is akin to an experimental, driverless car owned by Uber killing a pedestrian who was jaywalking on a dark road in Tempe, Arizona on May 18, 2018. The back-up driver, who was supposed to keep a sharp eye on the road to prevent such an accident, was watching reruns of the reality TV show “The Voice” at the time.

Despite such incidents (there have been 4 fatalities already), the bourgeoisie is determined to push ahead since the savings in labor costs will make up for the collateral damage of dead pedestrians. While I am skeptical that completely driverless cars will ever become the norm for Uber or Lyft, I can see people with little driving experience being paid minimum wage just to be a back-up to the computer system—as long as they don’t watch TV on the job. (Fat chance with such a boring job.)

This morning Donald Trump tweeted about the airline crash. “Airplanes are becoming far too complex to fly. Pilots are no longer needed, but rather computer scientists from MIT. I see it all the time in many products. Always seeking to go one unnecessary step further, when often old and simpler is far better. Split second decisions are….”

To begin with, the issue is not planes becoming too complex. It is rather that they are becoming too simple in terms of the amount of deskilling the airlines favor. As for the issue of replacing human labor with robots, he is all for it—reflecting the priorities of a ruling class bent on driving down wages.

In a US News and World Report article titled “The Race Is On After Feds Pave Way for Driverless Trucks”, we learn:

The most optimistic analysts project that trucks with empty cabs and a computer at the wheel will travel on U.S. highways in as little as two years with no escort or safety driver in sight now that the Trump administration has signaled its willingness to let tractor-trailers to become truly driverless.

The U.S. Department of Transportation this month announced that it will “no longer assume” that the driver of a commercial truck is human, and the agency will even “adapt the definitions of ‘driver’ and ‘operator’ to recognize that such terms do not refer exclusively to a human, but may in fact include an automated system.”

Already, automated truck developers such as Embark and TuSimple have made freight deliveries where the computer takes control on the highway, overseen by a human “safety driver.” Companies have also successfully tested “platooning,” where a truck with a human driver leads a convoy of as many as five computer-driven trucks following at close distance to reduce drag and save fuel.

The technologies promise big savings, with driverless trucks potentially slashing 40 percent from the cost of long-haul freight – much of it in saved labor expenses – and platooning cutting 10 to 15 percent in fuel costs.

If it is good for cars and trucks, why not airplanes?

Two years before the Indonesian 737 crash, the Guardian published an article titled “Crash: how computers are setting us up for disaster” that it clearly anticipated. Interestingly enough, it was not even a Boeing plane that was discussed in the article. It was an Airbus 330 that had the same kind of systems as the Boeing NCAS. With pilots much more used to relying on automation than manual control of the plane, they failed to override the system that was forcing the plane to plunge into the Atlantic Ocean on June 1, 2009 at about 125 miles an hour. Everyone on board, 228 passengers and crew, died instantly.

While pilots flying to major airports will continue to be highly paid, the wages of those working for regional airlines has fallen drastically. In 2010, the Guardian reported on “A pilot’s life: exhausting hours for meagre wages”. They lead a decidedly unglamorous life:

Many are forced to fly half way around the country before they even begin work. Others sleep in trailers at the back of Los Angeles airport, in airline lounges across the country or even on the floors of their own planes. Some co-pilots, who typically take home about $20,000 (£12,500) a year, hold down second jobs to make ends meet.

All that will change when airplanes go the route of driverless cars as the NY Times reported last July in an article titled “Are You Ready to Fly Without a Human Pilot?” In the same fashion that Trump backed driverless trucks, the move toward pilotless planes seems inexorable:

Regulators are already taking steps toward downsizing the role of humans on the flight deck. The bill to reauthorize the Federal Aviation Administration included language to provide funding to study single-pilot operations for cargo planes, a move that the Air Line Pilots Association opposed. Captain Canoll said that a single-pilot aircraft must be safe to fly without anyone at the controls in case the pilot takes a bathroom break or becomes incapacitated.

At the recently concluded World Economic Forum, there was a big focus on artificial intelligence and robotics. On the website, you can findbreathless articlesabout “Meet Stan: the robot valet that parks your car at the airport” and “US companies created a record number of robot workers in 2018”. In a Washington Post article on the WEF, the title betrayed a certain unease about the replacement of human beings by robots: The aristocrats are out of touch’: Davos elites believe the answer to inequality is ‘upskilling’.It cited Blackstone CEO Stephen Schwarzman about how to keep the masses docile: “The lack of education in those areas in digital is absolutely shocking. That has to be changed. That will very much lessen the inequalities that people have in terms of job opportunities.”

What world are these people living in? Schwarzman has a 32-room penthouse in 740 Park Avenue and spent $5 million for his birthday party in 2017. He just made a gift of $1 billion to MIT to launch a new school for Artificial Intelligence. Is that supposed to create jobs? Maybe for someone with an MIT degree who will go to work writing software to replace the people working for Jeff Bezos’s slave labor-like warehouses with machines but what is someone out of a job at an Amazon warehouse then supposed to do? Apply to MIT?

The handwriting is on the wall. The USA is moving into a two-tiered system. In places like NYC, Boston, San Francisco, Seattle and Portland, you get people working in high-tech industries that in contrast to the Fordist model of the 1930s employ far fewer bodies. Meanwhile, in Detroit, Cleveland, and other places where Fordism once held sway, the jobs are there if you are willing to work at Walmarts, at local hospitals emptying bedpans or as guards in a jail or prison. Class divisions between those with advanced technology skills and those left out will only increase, leading to the kind of showdown taking place in France between the neoliberal state and the Yellow Vests.

You get a feel for the Two Americas reading a March 7thNY Times article titled “Thousands of New Millionaires Are About to Eat San Francisco Alive”:

In cities like Oakland and Berkeley and San Francisco, millennials obsess over Alexandria Ocasio-Cortez’s Twitter and attend Democratic Socialists of America meetings. But the socialist passion doesn’t seem to have impacted the city’s zeal for I.P.O. parties, which the party planning community says are going to surpass past booms.

Jay Siegan, a former live music club owner who now curates private entertainment and music, is gearing up. He has worked on events for many of the I.P.O. hopefuls, including Uber, Airbnb, Slack, Postmates and Lyft.

“We see multiple parties per I.P.O. for the company that is I.P.O.ing, as well as firms that are associated to them,” Mr. Siegan said. Budgets for start-up parties, he said, can easily go above $10 million. “They’re wanting to bring in A-list celebrities to perform at the dinner tables for the executives. They want ballet performers.”

The only comment I would add to this tale of two cities is that it would not be surprising if some of these high-flying technology workers might also plan to vote for Bernie Sanders. They probably don’t feel happy about living in a city where their wealth has driven up the cost of housing to the point that homelessness is an epidemic. Whether President Sanders can do much about these class divisions is open to debate.

The replacement of human labor by machinery has been described as “creative destruction”. The assumption is that the temporary pain is worth it since there will always be the growth of new jobs. As my seventh grade social studies put it, the invention of the automobile put the blacksmith out of work but it created far more jobs in a Ford plant.

On May 12, 2010, the New York Times ran an article by economics editor Catherine Rampell titled “The New Poor: In Job Market Shift, Some Workers Are Left Behind”that focused on the largely middle-aged unemployed who will probably never work again. For example, 52 year old administrative assistant Cynthia Norton has been working part-time at Walmart while sending resumes everywhere but nobody gets back to her. She is part of a much bigger picture:

Ms. Norton is one of 1.7 million Americans who were employed in clerical and administrative positions when the recession began, but were no longer working in that occupation by the end of last year. There have also been outsize job losses in other occupation categories that seem unlikely to be revived during the economic recovery. The number of printing machine operators, for example, was nearly halved from the fourth quarter of 2007 to the fourth quarter of 2009. The number of people employed as travel agents fell by 40 percent.

But Ms. Rampell finds the silver lining in this dark cloud:

This “creative destruction” in the job market can benefit the economy.

Pruning relatively less-efficient employees like clerks and travel agents, whose work can be done more cheaply by computers or workers abroad, makes American businesses more efficient. Year over year, productivity growth was at its highest level in over 50 years last quarter, pushing corporate profits to record highs and helping the economy grow.

The term “creative destruction” might ring a bell. It was coined by Werner Sombart in his 1913 book “War and Capitalism”. When he was young, Sombart considered himself a Marxist. His notion of creative destruction was obviously drawn from Karl Marx, who, according to some, saw capitalism in terms of the business cycle. With busts following booms, like night follows day, a new round of capital accumulation can begin. This interpretation is particularly associated with Volume Two of Capital that examines this process in great detail. Looking at this material, some Marxists like Eduard Bernstein drew the conclusion that capitalism is an infinitely self-sustaining system.

By 1913, Sombart had dumped the Marxist commitment to social revolution but still retained the idea that there was a basis in Karl Marx for upholding the need for “creative destruction”, a view buttressed by an overly positive interpretation of this passage in the Communist Manifesto:

The bourgeoisie cannot exist without constantly revolutionizing the instruments of production, and thereby the relations of production, and with them the whole relations of society. Conservation of the old modes of production in unaltered form, was, on the contrary, the first condition of existence for all earlier industrial classes. Constant revolutionizing of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones.

By the 1930s, Sombart had adapted himself fairly well to the Nazi system although he was not gung-ho like Martin Heidegger or Carl Schmitt. The wiki on Sombart notes:

In 1934 he published Deutscher Sozialismus where he claimed a “new spirit” was beginning to “rule mankind”. The age of capitalism and proletarian socialism was over and with “German socialism” (National-Socialism) taking over.

But despite this, he remained critical. In 1938 he wrote an anthropology text that found fault with the Nazi system and many of his Jewish students remained fond of him.

I suspect, however, that Rampell is familiar with Joseph Schumpeter’s use of the term rather than Sombart since Schumpeter was an economist, her chosen discipline. In 1942, he wrote a book titled Capitalism, Socialism and Democracy that, like Sombart, retained much of Karl Marx’s methodology but without the political imperative to destroy the system that utilized “creative destruction”. He wrote:

The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the same process of industrial mutation–if I may use that biological term–that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in. . . .

The wiki on Schumpeter claims that this theory is wedded to Nikolai Kondratiev’s “long wave” hypothesis that rests on the idea that there are 50 year cycles in which capitalism grows, decays and enters a crisis until a new round of capital accumulation opens up. Not only was the idea attractive to Schumpeter, it was a key part of Ernest Mandel’s economic theories. Unlike Schumpeter, Mandel was on the lookout for social agencies that could break the cycle and put development on a new footing, one based on human need rather than private profit.

Returning to Rampell’s article, there is one dimension entirely missing. She assumes that “creative destruction” will operate once again in order to foster a new upswing in the capitalist business cycle. But how exactly will that manifest itself? All the signs point to a general decline in business activity unless there is some kind of technological breakthrough equivalent to the computer revolution that fueled growth for decades. Does anybody believe that “green manufacturing” will play the same role? I don’t myself.

One thing does occur to me. Sombart’s book was written in 1913, one year before WWI and was even titled eerily enough “War and Capitalism”. One wonders if the Great War would be seen as part and parcel of “creative destruction”. War, after all, does have a knack for clearing the playing field with even more finality than layoffs. Schumpeter wrote his in 1942, one year into WWII. My guess is that he did not theorize war as the ultimate (and necessary?) instrument of creative destruction but history will record that WWII did introduce a whole rafter of new technology, including aluminum, radar, nuclear power, etc., while bombing old modes of production into oblivion. What a great opportunity it was for capitalism to rebuild Japan, especially after firebombing and atomic bombs did their lovely work.

In my view, there’s something disgusting about this “creative destruction” business especially when it is articulated by a young, pro-capitalist Princeton graduate like Catherine Rampell who wrote for Slate, the Village Voice and other such b-list publications before crawling her way up into an editorial job at the NYT. She clearly has learned how to cater her reporting to the ideological needs of the newspaper of record, growing more and more reactionary as the crisis of capitalism deepens.

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Louis Proyect blogs at http://louisproyect.org and is the moderator of the Marxism mailing list. In his spare time, he reviews films for CounterPunch.

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