Q: What can be done to cope with the rise of the "obsoletariat"?

I don't know about the last century, but I did his post a thread on this sub a few days ago about this paper which led to an interesting thread about trade with China:

http://www.nber.org/papers/w21906

The short version is that the authors have shown that trade with China since the early 1990s has not actually created the offsetting benefits we always hear about. It turns out that exposing the American economy to competition from people who could do the same labor much more cheaply devastated huge portions of the country, and that most did not move into better new jobs created afterward. They either became unemployed or moved into worse jobs, wages stagnated or decreased, and in another paper, the same authors showed that there was actually a net decrease in total jobs which they estimated at about 2.4 million net job losses resulting from trade with China, rather than an increase.

And this wasn't a short term transition - it is a persistent trend over decades.

As I mentioned in the other thread, I am no economist, and there seem to have been lots of cases where this type of arrangement really did produce the benefits economists suggest. But it is apparently not a law of nature - this type of competition really does seem capable of also producing long lasting negative results.

If trade with cheap Chinese labor can devastate the American working class for 30 years, in ways most economists thought were impossible, why should we calmly accept that competition with cheap automated labor can't have similar effects?

/r/AskSocialScience Thread Parent