Toys 'R' Us and the Gracchi Brothers

As a child, I felt that Toys 'R' Us was only a few steps away from heaven. The massive toy store, with every conceivable kind of toy or game a kid could think of, was a delightful part of life. More than thirty years later, I can still remember the route the car would take on those happy occasions when I had been especially good and my mother would take me there to pick out a new toy. I would be giddy with anticipation, imaging what new Transformer or Lego set I would carry home in all its glory. Such memories are held by millions of Americans.

Last month, Toys 'R' Us announced that it was going out of business after more than six decades, closing down all of its seven hundred and thirty-five stores. This is sad news for sentimental people such as myself, with so many happy memories of Toys 'R' Us, but it is far worse news for the tens of thousands of people who will lose their jobs.

Economists will carefully be analyzing the causes of the demise of Toys 'R' Us. Many have been quick to blame competition from Amazon, Walmart and Target. Other, more esoteric factors, such as the declining birthrate in the United States and other countries were Toys 'R' Us operates, are also likely to be noted. None of the experts are likely going to bring much comfort to the former company workers who are now going to be trying to find other ways to make ends meet.

Toys 'R' Us might have been a national chain, but the reasons for its demise are similar to those afflicting independent, locally-owned businesses across the country, which I wrote about last fall. A small number of powerful corporations are consolidating greater and greater proportions of market share into their hands. Clearly, Toys 'R' Us is not the only major retail chain to go out of business in the last few years. Some, like Blockbuster Video, were victims of the failure to adapt to the challenges posed by new technologies. The national bookstore chain Borders is gone and Barnes and Noble (which recently had to lay off nearly 2,000 workers) may soon follow, simply unable to compete with online retailers. Once mighty department stores like Montgomery Ward have gone the way of the dodo, while others like Sears are on life-support. All over the country, once thriving shopping malls now are quiet and empty, like old ghost towns in the American West. Amazon and Walmart seem likely to be the only men left standing when the dust settles.

Thus far, the ongoing consolidation does not seem to be producing a drag on overall employment. Indeed, according to the Bureau of Labor Statistics, the unemployment rate of the United States currently stands at 4.1%, nearly a twenty-year low. On the other hand, we have now had a steady decrease in the unemployment rate since October of 2009. If experience is any guide, the trend will soon reverse, because no one has yet devised a way to break out of the boom-and-bust cycle that has long characterized national economies across the world. And if such a massive percentage of our nations labor force is employed by such a small number of powerful mega-corporations, with no real loyalty to their employees, we might even see more ruthless job-cutting than normal when the time inevitably comes.

There is another factor at work, whose impact is only just beginning to be felt but will have repercussions so enormous that it is difficult to fully fathom them: the trio combination of automation, robotics, and artificial intelligence.

Of course, people have been crying foul over automation's impact on the work force for nearly two centuries. The Luddites were smashing textile machinery in England in a futile effort to protect their jobs as far back as 1811. Such people have long been dismissed as cranks and economists have pointed out, correctly, that the development of new technologies has always created more jobs than it has taken away. White collar service jobs have expanded in America even as blue collar manufacturing jobs have proportionally diminished, thanks to basic economic expansion and the creation of new types of professions, such as computer programmers.

However, the welding of automation to advanced artificial intelligence is going to be a game-changer. It is no longer a matter of using technology to make individual workers more productive, but using technology to replace human labor altogether. According to a widely circulated report last fall by the McKinsey Global Institute, between 40 million and 70 million jobs could be lost in the United States due to the automation/robotics/artificial intelligence combination. Some of the jobs to be lost are obvious and expected, such as fast food workers and cashiers, due simply to basic automation. The advent of artificial intelligence, however, means that many professions previously seen as immune from automation will be endangered, such as mortgage lenders, paralegals, and a whole multitude of other such jobs.

The authors of the report counsel us not to worry too much, however, for economic growth and the increase in the number of jobs involved in healthcare for the elderly will go a long way to make up for the jobs lost to the automation/robotics/artificial intelligence combination. Perhaps. But this certainly feels different.

As usual, there is a telling story from ancient history that might help shed some light on this strange and new development. It is the dramatic and ultimately tragic tale of two brothers, Tiberius and Gaius Gracchis, two of the most important figures in Roman history, whose actions helped spark the downward spiral that would eventually bring down the Republic and replace it with the autocratic Empire.

The Gracchi brothers lived during the 2nd Century BC and were members of the distinguished Sempronia family. After the early death of their father, they were raised by their mother Cornelia, who went down in history as one of the greatest examples of what a Roman mother should be. They received an outstanding education by Greek tutors. Tiberius, the older brother by about a decade, was a distinguished officer during the Third Punic War and was said to have been the first Roman over the walls of Carthage. As was customary for a respected member of an aristocratic family, he began moving up the cursus honorum and was elected quaestor. Sent out to help stabilize the rebellious provinces in Spain, Tiberius negotiated with an enemy that had defeated a hapless Roman governor so as to allow twenty thousand Roman soldiers to depart who would otherwise have been slaughtered.

As his star rose in the realm of Roman politics, Tiberius turned his attention to a longstanding problem that was reaching critical proportions, to which we can draw analogies to the developing employment crisis in our own time.

Rome had originated as a society of citizen farmers and small landholders. Members of older, noble families might control more land, but the strength of the Republic was personified in the simple, stoic Roman farmer who owned his own land. Only such men were allowed to serve in the legions, for they could provide their own weapons and equipment (nobles, for their part, provided the officer corps and the cavalry). The grain of the farms fed Roman mouths and modest land taxes financed the state. For centuries, the system worked remarkably well.

The Second Punic War proved a turning point. For one thing, Hannibal's depredations in Italy inflicted terrible damage on the Roman agricultural economy. For another, the manpower of Rome was almost fully mustered into the legions, where much of it was slaughtered. For decades, Roman farms were worked largely by the women and children who had remained behind on the fields. Even after the end of the long war in 202 BC, Roman legions campaigned for decades in regions remote from Italy, going as far as Spain, Greece, and into Asia.

As the wars finally wound down with the firm conquest of Greece and the destruction of Carthage, the long-suffering soldiers returned home to find their lands (or, conceivably, the lands that they thought they had inherited from their fathers and grandfathers) were no longer theirs, but had been bought up by the wealthy citizens when the families occupying them become so desperate that they had no choice but to sell. The vast tracts of public land (ager publicus) that had been seized by Rome from its enemies had become, in effect, the private property of wealthy citizens, too. Making this bad situation even worse was the enormous influx of slave labor into Roman lands, men captured in war and prisoners from conquered cities. The common Roman citizen quickly discovered that his small farm could not hope to compete with vast agricultural estates worked by slaves.

Soon, a steady stream of impoverished people were moving from their failed farms into the city of Rome itself, looking for work or some other means of survival. The population expanded rapidly and stretched municipal resources to the breaking point. A large class of urban poor was created. Very soon, the mob that had come into being would be a decisive factor in Roman politics. Also alarming was the fact that only landowners were legally allowed to serve in the Roman legions; the growing proportion of landless citizens threatened Rome's source of military manpower.

Tiberius Gracchus recognized the dispossession of the poor from their land as a crisis which, if it were not dealt with, might bring down the Republic altogether. In 133 BC, he was elected a tribune of the plebs, an office created to protect the interest of the common people, and Tiberius took up the cause of the landless poor in general and homeless veterans in particular. He proposed a law that would redistribute land to these people, giving them the ability to support themselves and no longer be wards of the state. The Senate, whose members were universally of the wealthy, landowning class, refused to even consider these reforms. Rather than accept this, Tiberius went over the head of the Senate and proposed the laws directly to the Concilium Plebis (the "Plebian Council" or "Popular Assembly"), made up of the whole of the common people. This was technically within his rights as a tribune, and it was also technically within the rights of the Concilium Plebis to pass legislation, but these powers had not been exercised within living memory, so completely did the Senate dominate the political landscape of the Senate.

The aristocrats were determined to block Tiberius, for they had no intention of sacrificing the wealth that the newly acquired land represented. They persuaded one of Tiberius's colleagues in the tribunate, Marcus Octavius (incidentally an ancestor of the future emperor Augustus), to veto the proposals when they were passed by the Concilium Plebis. Most likely he had been bribed to do so, either with money or with promises of favors after his term as tribune ended. Tiberius saw the actions of Octavius as a serious violation of the man's pledge to protect the interests of the Roman people.

Tiberius then did something unthinkable. He instructed his supporters to physically remove Octavius from the Assembly's meeting, which they promptly did. This turned what had been a political controversy into a serious constitutional crisis, for tribunes were sacrosanct and it was strictly forbidden for any Roman citizen to lay a hand on them during their term in office. This was more than a mere rule, for it was essentially a religious and sacred obligation. In violating the sacrosanct status of Octavius, Tiberius was moving far beyond the traditional methods of Roman statesmen. Members of the Senate now suspected that Tiberius intended to overthrow the Republic altogether and make himself a king.

Tiberius now proceeded to use his tribunal powers to veto every single piece of legislation that came before the Concilium Plebis, shutting down government entirely, and asserted that he would continue doing so until his land reform proposals were made into law. He eventually was able to get the Assembly to both remove Octavius as a tribune and ram his proposals through so that they became law. A special committee was created to oversee the redistribution of land, which Tiberius promptly filled with members of his own family. The Senate refused to provide the committee with the necessary funds, but Tiberius simply allocated money to it that had come to Rome from the defunct Kingdom of Pergamum in what is today Turkey.

The Senate now believed that the survival of the Republic was at stake and that, since Tiberius had chosen to violate all constitutional norms and traditions, it was now necessary for them to do the same. After Tiberius was reelected to the tribunate (again, technically legal but a violation of tradition), he promised further sweeping populist reforms. A mob of senators and their supporters swarmed around Tiberius when he next appeared in the Forum, beating him to death and throwing his body unceremoniously into the Tiber River. For this, they earned the wrath of the common people, who had looked upon Tiberius as their hero and champion.

The younger Gracchi, Gaius, took up the cause after the assassination of Tiberius. His story was almost an identical repeat of what happened to his older brother. Taking office as a tribune of the plebs, he proposed an expansion of the land reform law, extension of Roman citizenship to other Italian cities, and the provision of grain to the poor at state expense. For all this, he suffered his brother's fate, differing only in that he committed suicide when cornered by senatorial supporters rather than being killed outright by them. Either way, he was just as dead.

The violent deaths of the Gracchi marked a turning point in Roman history. Previously, while political debate in Rome had often been heated and acrimonious, it had not involved outright violence and bloodshed. The episode of the Gracchi brothers, however, shattered long-established traditions and constitutional norms, making violence an acceptable part of the political process in the Republic. The course was now set inexorably to the violent, unconstitutional usurpations of power by Marius, Sulla, Caesar, and the eventual collapse of the Republic altogether. What rose from the ashes was the autocratic Empire, which certainly reached great heights of power and culture, but was in no way at all a free society.

When I reflect on the steady consolidation of larger and larger shares of the economy into a few powerful corporations and the terrifying potential of the automation/robotic/artificial intelligence combination to entirely replace human workers rather than simply make individual workers more productive, I am filled with foreboding. To me, the consequences might well be similar to those that swept through the Roman Republic when the small landowners were dispossessed of their farms during the 2nd Century BC. Now, as happened then, the gates will be opened for charismatic populists, for either well-meaning or self-serving purposes, to shatter the foundations of the society and so wreck its governmental framework that the whole structure will eventually fall apart.

We are currently living through an age in which the dangers of populist demagoguery are all too clear. How much more dangerous will populism be if measures aren't taken to ensure an economy that has enough worthwhile jobs for its labor force? Decades from now, when tens of millions may have been thrown out of work by artificially intelligence robots, how much more easy will it be for unscrupulous demagogues to whip the people up into frenzies?

It is, at the very least, something to think about.