Saturday, July 11, 2020

Some deep thinking about economics

Our town only has a few businesses. There's a winery that offers wine tastings, and occasional concerts and other events. A liquor store, a chainsaw shop, an auto repair shop, an acupuncturist, and a seamstress. (There isn't any gender neutral term for that, that I can think of. She is female.) There are also cornfield and hayfields, but the animals they feed are elsewhere; and two farms that grow produce. The young man next door rents a workshop from me where he makes dulcimers and other fine wood objects, and there might be other inconspicuous small enterprises I don't know about.

Anyway, that's just to put me in context. I was at the garage the other day to get some work done on my truck and I noticed that the wrecked vehicles were piling up on the premises. They have a flatbed and they get the call to pick up the wreckage when somebody drives into a tree, which happens much too often. Rand told me there's no market for scrap metal right now; they'd have to pay somebody to take it away.

That got me to thinking. The economic catastrophe associated with the pandemic has sharply reduced greenhouse gas emissions, and likely industrial emissions. There's no market for junk because there are fewer cars being made and sold. Less clothing is sold because people don't need to look sharp for work. (Brooks Brothers declared bankruptcy.) Clothing is actually very resource intensive, there's a large environmental burden to growing cotton and making synthetic fabrics. People not commuting to work and not consuming as much buys us some time for saving the planet.

The problem is, the way we distribute resources throughout the economy, at least to the non-wealthy, is through employment. And in order to employ everybody, we actually need to be wasteful. All that driving to work, eating in restaurants, drinking in bars, gambling in casinos, buying new clothing every few months, manufacturing automobiles -- that's what moves money around and keeps people from starving. And we grow most of our food on 400 acre monocultures using $100,000 tractors and ship it 2,000 miles because that actually makes it a little bit cheaper, although it also means that most of what people eat is junk. But agriculture hardly employs anybody any more.

The fact is that there are plenty of resources to meet everybody's needs comfortably, but the only means we have to get them to people are unnecessary and harmful. Most people's jobs have little or no intrinsic reward, and the harder you have to work and the more onerous the task the less you get paid. Lots of people spend two hours or more every day just commuting to work, which let me tell you is soul destroying. I could range much more broadly with this  -- from music and other entertainment, which used to employ people in every town but with the advent of recording and broadcasting now supports a small number of people, a few of them fabulously wealthy, most just getting by. But in sort, mass production has replaced artisanry.

Capital intensity makes goods cheaper and drives out labor intensive forms of production. But people need fulfilling jobs, and labor intensive production generally causes less environmental damage, promotes local community, and offers more fulfilling work because the tasks are more varied and interesting, require more skill, and provide the satisfaction of making  a tangible product. The logic of capitalism however tends inexorably to more and more capital intensity. The question is how we can achieve a different kind of economic order.

These thought are a bit disorganized, I know. I'm just rambling. But maybe I can sharpen it in due course.

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