The New Burger Chef Makes $3 An Hour And Never Goes Home. (It’s A Robot) –– If You Can’t Stand The Heat, Let Robots Do The Cooking (Demo)

On March 1, 2020, Sam Dean writes in the Los Angeles Times:

Flippy the robot running a fry station at Miso Robotics’ test kitchen in January in Pasadena.(Gina Ferazzi/Los Angeles Times)

At $3 hourly, machines are touted as an option for hard-tofill food jobs

In a test kitchen in a corner building in downtown Pasadena, Flippy the robot grabbed a fryer basket full of chicken fingers, plunged it into hot oil — its sensors told it exactly how hot — then lifted, drained and dumped maximally tender tenders into a waiting hopper.

A few feet away, another Flippy eyed a beef patty sizzling on a griddle. With its camera eyes feeding pixels to a machine vision brain, it waited until the beef hit the right shade of brown, then smoothly slipped its spatula hand under the burger and plopped it onto a tray.

The product of decades of research in robotics and machine learning, Flippy represents a synthesis of motors, sensors, chips and processing power that wasn’t possible until recently.

Now, Flippy’s success — and the success of the company that built it, Miso Robotics — depends on simple math and a controversial hypothesis of how robots can transform the service economy. Costing less to employ than a minimum-wage worker, Flippy is built to slip in right alongside humans on the fast-food line. MISO CEO Buck Jordan believes Flippy is poised to become a regular part of fast-food kitchens nationwide in the next year, especially in markets with higher labor and real estate costs.

Off-the-shelf robot arms have plunged in price in recent years, from more than $100,000 in 2016, when Miso Robotics first launched, to less than $10,000 today, with cheaper models coming in the near future.

As a result, Miso can offer Flippys to fast-food restaurant owners for an estimated $2,000 per month on a subscription basis, breaking down to about $3 per hour. (The actual cost will depend on customers’ specific needs). A human doing the same job costs $4,000 to $10,000 or more a month, depending on a restaurant’s hours and the local minimum wage. And robots never call in sick.

If the cost of hardware hadn’t gone down so quickly, Miso’s business model would never have worked, said Buck Jordan, the company’s chief executive. “We took a bet,” he said. “A risky bet. But it’s paying off.”

So far, early versions of Flippy have put in time on the line at Dodger Stadium and at locations of CaliBurger, a small quick-serve chain that Jordan says also functions as “a restaurant tech incubator masquerading as a burger joint” (Cali Group, CaliBurger’s parent company, is the parent company of Miso Robotics as well as two other restaurant industry start-ups.) The next version of the robot will use the new, cheaper arms and be mounted on an overhead rail to conserve floor space in tight kitchens.

Jordan believes Flippy is poised to become a regular part of fast-food kitchens across the country in the next year, especially in markets with higher labor and real estate costs like California. Miso has raised more than $13 million in investment and is currently trying to raise an additional $30 million to fund its push into fast-food kitchens from small investors on the equity crowdfunding platform SeedInvest.

The restaurant industry as a whole has been facing a labor crisis for years, fueled by record-low unemployment across the economy and ever-rising consumer demand for prepared food. Nationally, the sector consistently has one of the highest percentages of open positions, with more than 820,000 unfilled jobs in December 2019, according to federal statistics. And turnover rates, which have always been high for low-paying fastfood jobs, have climbed to more than 100% per year.

At fry stations, churn is even higher, with the average worker lasting just three months in front of the bubbling oil, according to Jordan.

Those problems are intensified in areas with high real estate costs, including many of California’s urban centers. Higher business rents put pressure on restaurants to increase revenues, while higher residential rents make nearby homes unaffordable for people earning fast-food wages, stretching commute times beyond what workers will tolerate. That makes a worker who never leaves the premises that much more attractive.

Miso Robotics is hardly the first company to try to find profits in automating kitchen drudgery. Food has long been on the forefront when it comes to replacing human effort with machine labor. In the 1920s, it was a new device called the dishwasher that was raising alarms, threatening to wipe out an entire category of back-of-house jobs.

Despite the intersecting trend lines of cheaper technology and tighter labor markets, however, restaurant robot companies have been struggling.

Zume, a Mountain View, Calif.,-based company that tried to build a fleet of pizza delivery trucks that used robot arms to cook the pizza en route, received $375 million from Softbank’s $100-billion Vision Fund in late 2018. In January, the company laid off more than half of its employees and announced that it would no longer make or deliver pizza, focusing instead on industrial packaging. Zume’s pizza, according to reviews by customers, was never that good.

Creator, a restaurant built around a mainframe-size robot that builds burgers from scratch, from grinding the beef and slicing the tomatoes to assembling the final product, has built a more loyal following (and better Yelp reviews) at its one location in San Francisco. But the company has yet to expand beyond its single location, and a deal with the SoftBank Vision Fund reportedly hit the rocks in January.

And in China, e-commerce giant Alibaba has a chain of largely automated grocery stores with attached diners staffed by robot waiters. The real estate giant Country Garden Holdings recently opened its first fully robotic restaurant in Guangzhou, where computers and robots handle ordering, food prep, serving and cleanup.

But not all restaurant robots are made alike, and the industry is split between two distinct visions of how robots can transform the service sector.

On one side, which includes Miso, are the robots that slot into existing human environments to perform specific tasks in much the same way a person would. Flippy never tires, doesn’t mind a splash of hot oil, and produces a more consistent fried product, but ultimately it’s handling the same fry baskets and spatulas as a flesh-and-blood worker.

On the other side, burger machines like Creator take a different approach: They remove the human entirely, operating in an enclosed environment in which robots can do things in more robotic ways.

Both camps think the other one is dead wrong.

Avidan Ross, whose venture capital fund Root Ventures has backed Creator, said, “My belief is that people who are using industrial robot arms today are primarily using those on a couple flawed assumptions.” He likened it to the idea of building a humanoid robot driver with robotic arms to drive a self-driving car.

“Doing everything based on human limitations makes no sense,” Ross said. “The better opportunity is to build robots from the ground up based on first principles.”

Aaron Ames, a professor of robotics at Caltech who specializes in making robots walk and who serves as a technical advisor to Miso Robotics (whose technical team is run by Caltech grads), could not disagree more strongly.

“My short answer is: Good luck with that,” Ames said. “I’m a firm believer that the real way to get things out of there, especially in a short time frame, is to go build robots that work in human environments. The only reason not to do it is that it’s harder.”

For most of the time robots have been around, the notion of building them to operate in human workplaces was a far-off fantasy. Until recently, most required fully robot-centric environments. Similar to early computer mainframes, which were scheduled for computational activity around the clock, industrial robots have been too expensive to run at anything below maximum capacity for most of their history. Unlike early computers, high-output robots are also too strong and dumb to safely work alongside humans.

But now that costs have come down and both motor and sensor technology has improved, robots are safe and cheap enough to use in occasional spurts in a normal work environment. That has given rise to panic about a “job apocalypse.” But many experts predict the real effects will be subtler and more mixed.

Ken Goldberg, a professor of engineering at UC Berkeley, likens the effect on the workforce to the advent of personal computers and software.

“When spreadsheet software first came out, everyone was predicting the end of all bookkeeping and accounting jobs,” he said. “What actually happened was it changed the job, so accountants didn’t spend their time punching numbers into the adding machine all day, but instead started doing all these visualizations and scenario planning.”

Likewise, restaurants still need people to load and unload those dishwashers.

Goldberg spends part of his time working as the chief scientist at a robot start-up called Ambidextrous, which is using similar technology to build robots to do another type of common low-wage work: picking and sorting objects into packages at warehouses.

“The problems you have in fast food are very analogous to the problem we’re facing in warehouses,” Goldberg said. “It’s actually difficult to hire enough people for the job.” In both cases, having a robot on-site fills a gap in the labor market and makes it easier to ratchet up output during flash sales or the holiday season, for warehouse work, and during peak dinner hours or post-event rushes, in restaurants.

Beyond the technological debate, Miso’s CEO said that building robots that can work in existing kitchens alongside humans lets him avoid an even thornier problem: how to keep a new restaurant concept from tanking.

“All the competition is focused on making their own brands, which I get it, it’s a lot of fun,” Jordan said. “I would love to own a restaurant, too — in fact, I did, and it went out of business.”

“We fit into existing brands that are already successful at making food,” rather than trying to build a new menu and dining experience from scratch, Jordan said. “You don’t ask Caltech roboticists to make an amazing chicken sandwich.”

https://www.latimes.com/business/technology/story/2020-02-27/flippy-fast-food-restaurant-robot-arm

Gary Reber Comments:

It is way past time to let reality sink in.

This report presents a trend that was recently reported by Oxford Economics that estimates that about 8.5 percent of the global workforce stands to be replaced by robots, with about 14 million manufacturing jobs lost in China alone.

The number of robots currently in the global workforce, 2.25 million, has multiplied threefold over the past 20 years, doubling since 2010. According to the report, every third robot is installed in China. The country accounts for about 20 percent of robots worldwide. Additionally, since 2004 each new robot installed in the manufacturing sector has displaced an average of 1.6 workers.

Over this decade, the U.S. is projected to lose more than 1.5 million jobs to automation. China is slated to lose almost 12.5 million, the European Union will lose nearly 2 million jobs and South Korea will lose almost 800,000. Other countries around the world are expected to lose 3 million jobs to robots by 2030.

Robotic artificial intelligence (AI) and sophisticated automation is the future of manufacturing and service industries. The impact will leave hordes of citizens of zero economic value. That is, unless the system can be reformed to empower EVERY citizen to become an owner of the wealth-creating, income-producing capital assets resulting from technological invention and innovation. In other words, as a natural right, every individual child, woman and man, as individuals, must become owners of the “machines” that replace the necessity to work.

Because non-human productive physical capital is increasingly the source of the world’s economic growth it should become the source of added property ownership incomes for all. The reality is if both labor and capital are independent factors of production, and if capital’s proportionate contributions are increasing relative to that of labor, then equality of opportunity and economic justice demands that the right to property (and access to the means of acquiring and possessing property) must in justice be extended to all.

Rather than focus on Job Creation, Job Retraining, and a redistributed Minimum Guaranteed Income that holds back technological invention and innovation, our economic policies should focus on Ownership Creation of wealth-creating, income-producing productive capital asset formation simultaneously with the growth of the economy.

Given that there is no question that robotic technology, AI and sophisticated automation will continue to expand the productivity and in large measure destroy jobs and devalue human labor, the question that SHOULD be urgently addressed is WHO SHOULD OWN THE FUTURE TECHNOLOGY ECONOMY? Will ownership continue to concentrate among the upper 10 percent of the wealthy ownership class who now OWNS America, or will we reform the system to provide equal opportunity for EVERY child, woman, and man to acquire personal ownership stakes in FUTURE non-human capital asset formations paid for with the FUTURE earnings of the capital asset investments in our technological future?

The conclusions should surprise no one who is conscious and who has even causally observed the constant shift to non-human productive inputs in the manufacturing, distribution, and sales of products, as well as the delivery of services, that has been occurring during their lifetime. The first burst of this phenomena was the Industrial Revolution. But now we are in an age of technology sophistication that is permeating every sector of industry and our day-to-day lives.

There’s nothing new about machines replacing people, but the rate of replacement is exponential and the result is that productivity gains lead to more wealth for the OWNERS of the non-human factor of production. For the vast majority of people, who have always been dependent on jobs as their source of income, there has been a steady decline to poverty-level labor incomes, as good jobs become scarcer and more people compete for fewer jobs, and the insecurity presented by “machine” replacement becomes a pressing factor, compounded by the exodus of manufacturing to other parts of the globe that produce more profits for the controlling owners of corporations.

What must be understood (which unfortunately is not understood by conventional economists) is that there are two independent factors of production––human or labor workers and non-human or physical productive capital––productive land, structures, machines, super-automation, robotics, artificial intelligence, digital computerized operations, etc.

Fundamentally, economic value is created through human and non-human contributions. To consume one must produce, either through their labor or through their “tools” that they own, or both.

Also what needs to be understood is that human productivity has not advanced (our human abilities are limited by physical strength and brain power––and relatively constant), but that the productiveness of the non-human factor of production––productive capital––is the reason that private sector corporations, majority owned and controlled by the “1 percent,” are utilizing the non-human factor of production increasingly to create efficiencies and save labor costs. It is the function of technology to save labor from toil and to enable us to do things that otherwise is humanly impossible without non-human input.

Today, large streams of data, coupled with statistical analysis and sophisticated algorithms, are rapidly gaining importance in almost every field of science, politics, journalism, and much more. What does this mean for the future of work?

But what about Communist China, Asia and other countries with scores of wage-slave labor, the place where all the manufacturing jobs are supposedly going? True, Communist China, for example, has added manufacturing jobs over the past 15 to 20 years. But now it is beginning its shift to super-robotic automation. Foxconn, which manufactures the iPhone and many other consumer electronics and is China’s largest private employer, is on track to install over a million manufacturing robots within two more years. Thus, in reality, off-shoring of manufacturing will eventually be replaced by human-intelligent super-robotic automation (which, of course, does not rely on wage-salve labor and can be adopted and implemented by any country).

The pursuit for lower and lower cost production that relies on slave-wage labor will eventually run out of places to chase. “Rich” countries, whose productive capital capability should be owned by ALL their of citizens, as individual stake holders, should “re-shore” manufacturing capacity, and embrace ever-cheaper robotic manufacturing. 

At this moment in time, it is critical that we, as a people, decouple from our dependence on Communist China and other slave-wage labor countries, and re-energize and create the most sophisticated and technologically advance automation and “machine” manufacturing capability in the world. This is critical to achieving superior competitiveness and trade strength within a global context.

“The era we’re in is one in which the scope of tasks that can be automated is increasing rapidly, and in areas where we used to think those were our best skills, things that require thinking,” says David Autor, a labor economist at Massachusetts Institute of Technology.

Businesses increasingly have been spending more on technology and will continue to do so because they spent so little during the recession. Yet total capital expenditures are still barely running ahead of replacement costs. “Most of the investment we’re seeing is simply replacing worn-out stuff,” says economist Paul Ashworth of Capital Economics.

None of this is new from a macro-economic viewpoint as productive capital is increasingly the source of the world’s economic growth. The role of physical productive capital is to do ever more of the work of producing more products and services, which produces income to its owners. Full employment is not an objective of businesses. Companies strive to keep labor input and other costs at a minimum. Private sector job creation in numbers that match the pool of people willing and able to work is constantly being eroded by physical productive capital’s ever increasing role. 

Over the past century there has been an ever-accelerating shift to productive capital––which reflects tectonic shifts in the technologies of production. The mixture of labor worker input and capital worker input has been rapidly changing at an exponential rate of increase for over 244 years in step with the Industrial Revolution (starting in 1776) and had even been changing long before that with man’s discovery of the first tools, but at a much slower rate. Up until the close of the nineteenth century, the United States remained a working democracy, with the production of products and services dependent on labor worker input. When the American Industrial Revolution began and subsequent technological advance amplified the productive power of non-human capital, plutocratic finance channeled its ownership into fewer and fewer hands, as we continue to witness today with billionaire- and multi-millionaire-owners controlling and wholly benefiting from our productive capabilities and with government by the wealthy evidenced at all levels.

People invented tools to reduce toil, enable otherwise impossible production, create new highly automated industries, and significantly change the way in which products and services are produced from labor intensive to capital intensive––the core function of technological invention. Corporate tax attorney, investment banker, binary economist and author Louis Kelso attributed most changes in the productive capacity of the world since the beginning of the Industrial Revolution to technological improvements in our capital assets, and a relatively diminishing proportion to human labor. Capital, in Kelso’s terms, does not “enhance” labor productivity (labor’s ability to produce economic goods). In fact, the opposite is true. It makes many forms of labor unnecessary. Because of this undeniable fact, Kelso asserted that, “free-market forces no longer establish the ‘value’ of labor. Instead, the price of labor is artificially elevated by government through minimum wage legislation, overtime laws, and collective bargaining legislation or by government employment and government subsidization of private employment solely to increase consumer income.”

Furthermore, according to Kelso, productive capital is increasingly the source of the world’s economic growth and, therefore, should become the source of added property ownership incomes for all. Kelso postulated that if both labor and capital are interdependent factors of production, and if capital’s proportionate contributions are increasing relative to that of labor, then equality of opportunity and economic justice demands that the right to property (and access to the means of acquiring and possessing property) must in justice be extended to all. Yet, sadly, the American people and its leaders still pretend to believe that labor is becoming more productive.

The 400 wealthiest Americans and the other 1 to 10 percent richest Americans are rich because they own wealth-creating, income-generating productive capital assets. The disenfranchised poor and working and middle class are propertyless in terms of owning productive capital assets, and must depend on a job to earn an income or government policies that redistribute the earnings of the wealthy to those who cannot earn enough to support themselves and their families.

Because productive capital is increasingly the source of the world’s economic growth, shouldn’t we be asking the question why is not productive capital the source of added property ownership incomes for all? Why are we not addressing how the system facilitates greed capitalism and envy while concentrating productive capital ownership among the 1 to 10 percent of the population?

Yet, while the problem is one that no one can no longer ignore, the solution also is one starring them in the face but they just can’t see the simplicity of it.

The critical question becomes who should own productive capital? The issue of ownership is unbelievably overlooked by those in academia and politics, yet we live in country founded upon private property rights.

The fundamental challenge to be solved is how do we reinvent and redesign our economic institutions to keep pace with job destroying and labor devaluing technological innovation and invention so not all of the benefits of owning future productive capabilities accrues to today’s wealthy 1 percent ownership class, and ownership is broadened so that EVERY American earns income through full-earnings stock ownership dividends fully paid to the owners of public corporations, both established and viable start-ups, so they can afford to purchase and consume the products and services produced by the economy.

The change that is necessary is to reform the system to provide equal opportunity for EVERY American to acquire wealth-creating, income-generating productive capital assets on the basis that the investments will pay for themselves with their earnings––and on the same terms that the wealthy ownership class now utilizes. They are able to use the investment’s earnings to pay off the capital credit loans used to finance their investments, without having to use their own money or deny themselves consumption.

A National Right To Capital Ownership Bill that restores the American dream should be advocated by the progressive movement, which addresses the reality of Americans facing job opportunity deterioration and devaluation due to tectonic shifts in the technologies of production.

If we fail to reform the system in the face of the transition to optimizing the non-human factor of production, as workers are replaced by sophisticated and technologically advanced automation and “machines”, the number of consumers will significantly decrease. Without enough “customers with money,” businesses collapse. When enough businesses collapse, the economy collapses. This guarantees social and political collapse.

There is a solution, which will result in double-digit economic growth and simultaneously broaden private, individual capital asset ownership so that EVERY American’s income significantly grows, providing the means to support themselves and their families with an affluent lifestyle. The JUST Third WAY Master Plan for America’s future is published at http://foreconomicjustice.org/?p=5797.

The solution is obvious but our leaders, academia, conventional economist and the media are oblivious to the necessity to broaden ownership in the new productive capital asset formations of the future simultaneously with the growth of the economy, which then becomes self-propelled as increasingly more Americans accumulate ownership shares and earn a new source of dividend income derived from their capital asset ownership in the “machines” that are replacing them or devaluing their labor value.

The solution will require the reform of the Federal Reserve Bank to create new owners of future productive capital investment in businesses simultaneously with the growth of the economy. The solution to broadening private, individual ownership of America’s future capital wealth requires that the Federal Reserve stop monetizing unproductive debt, including bailouts of banks “too big to fail” and Wall Street derivatives speculators, and begin creating an asset-backed currency that would enable every child, woman, and man to establish a Capital Homestead Account or “CHA” (a super-IRA or asset tax-shelter for citizens) at their local bank to acquire a growing dividend-bearing stock portfolio to supplement their incomes from work and all other sources of income. Policies need to insert American citizens into the low or no-interest investment money loop to enable non- and undercapitalized Americans, including the working class and poor, to build wealth and become “customers with money.” The proposed Capital Homestead Act would produce this result.

Through JUST Third WAY reforms, economic growth would be freed from the slavery of past savings (“old money”), while creating a domestic source of new asset-backed, “pure” interest-free (but not cost free) money and expanded bank credit to finance new capital repayable solely with future savings (earnings). To ensure that ownership of future private sector growth and newly created wealth is universally and equally accessible to every citizen, such newly created money and credit would only be available through economic democratization vehicles, administered through the competitive member banks of a well-regulated Federal Reserve central banking system.

Under the first tier, future increases in the money supply (“new money”) would be linked to actual growth of the economy’s productive assets, creating new owners of new capital asset wealth through widespread and equal access to interest-free capital credit solely repayable with future profits. The Federal Reserve would create (i.e., “monetize”) interest-free credit, with lenders adding their normal markup as service fees above the cost of money. This would establish an unsubsidized minimal rate for financing technological growth. This would provide the public with a currency backed by increasingly more efficient instruments of production, real wealth-producing capital assets, rather than unsustainable government debt. The creation of new money and credit would be non-inflationary and would simultaneously broaden purchasing power throughout the economy. To accomplish this, a key reform is a two-tiered interest policy by the Federal Reserve that would distinguish between productive and non-productive uses of credit.

The second tier would allow substantially higher, market-determined interest rates for non-productive purposes, for which “past savings” would remain available. The Federal Reserve would be restrained from future monetization of national deficits or encouraging other forms of non-productive uses of credit, causing upper-tier credit to seek out already accumulated savings at market rates.

Capital Homesteading would also provide, through capital credit insurance, a rational way to deal with risk, as well as an additional check on the quality of loans being supported by the Federal Reserve. Capital credit insurance and reinsurance policies would offset the risk that the enterprises issuing new shares on credit might fail to repay the loans. Such capital credit default insurance would substitute for collateral demanded by most lenders to cover the risk of non-payment, thus enabling the poor and others with no or few assets to overcome the collateralizing barrier that excludes poor people from access to productive credit.

Support the enactment of the proposed Capital Homestead Act (aka Economic Democracy Act and Economic Empowerment Act) at http://www.cesj.org/learn/capital-homesteading/, http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/, http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/ and http://www.cesj.org/learn/capital-homesteading/ch-vehicles/. And The Capital Homestead Act brochure, pdf print version at http://www.cesj.org/wp-content/uploads/2014/11/C-CHAflyer_1018101.pdf and Capital Homestead Accounts (CHAs) at http://www.cesj.org/learn/capital-homesteading/ch-vehicles/capital-homestead-accounts-chas/.

Support Monetary Justice at http://capitalhomestead.org/page/monetary-justice.

Also see “The Path To Eradicating Poverty In America” at http://www.huffingtonpost.com/gary-reber/the-path-to-eradicating-p_b_3017072.html and “The Path To Sustainable Economic Growth” at http://www.huffingtonpost.com/gary-reber/sustainable-economic-growth_b_3141721.html. And also “Second Income Plan” at http://www.huffingtonpost.com/gary-reber/second-income-plan_b_3625319.html

Also see “Achieving The Green Economy” at http://www.foreconomicjustice.org/?p=9082.

Also see “Financing Economic Growth With ‘FUTURE SAVINGS’: Solutions To Protect America From Economic Decline” at http://www.foreconomicjustice.org/?p=17032 and “The Income Solution To Slow Private Sector Job Growth” at http://www.foreconomicjustice.org/?p=9872.

For an in-depth overview of solutions to economic inequality, see my article “Economic Democracy And Binary Economics: Solutions For A Troubled Nation and Economy” at http://www.foreconomicjustice.org/?p=11.