I don't think there is any negative feedback loop, that is I don't buy that poverty makes one dumber. I think link is elsewhere - dumb people correlate with poverty and violence. Anyone, when sufficiently desperate, will turn to crime but dumb people are more likely to get caught. I am willing to bet that intelligence study comparing violent offenders to college-educated population would show significant difference.

Going back to the main topic - what is there to do but service when "robots are doing what used to be your job?"

I recently traveled to India and observed first-hand what overpopulation (not automation, but effects - oversupply of 'general' labor - are the same) would do to labor market.

General poverty and 9 'servers' for each producer. I had driver with a car, maid, chef, bodyguard and a guide/translator assigned exclusively to me while living out of hotel suite that was excessively large. I certainly did not need or ask for any of it, but US-priced contract allowed for the expense and locals arranged based on that $ value.

So service there was great. And cheap. And everybody was poor.

The same is coming to US.

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