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Sunday, November 22, 2009

Are Productivity Gains Evil?

This story has a common evil fnord that's repeated over and over again. Due to productivity gains, employers can do the same amount of work with fewer workers. This "destroys jobs" and ruins the careers of the displaced workers.

"Productivity gains destroy jobs!" leads to people thinking "Productivity gains are evil!" It's offensive that the mainstream media doesn't roundly decry "That's a stupid idea!"

In a really free market, productivity gains are never evil. Suppose that 10,000 people are employed in industry X. Due to productivity gains, industry X can do the same work with only 1,000 people. Those 9,000 people find other jobs and produce other things. The net effect is that people get the output of industry X, *PLUS* what those 9,000 people produce in their new jobs.

Society as a whole benefits from the productivity gains.

What about the workers in industry X who lose their job? If industry X was the only industry that was experiencing productivity gains, then this would be bad for them. If every industry has productivity gains, then these workers benefit. They are forced to take a new job for lower pay, but they benefit from productivity gains in other industries. The value of the productivity gains more than offsets the inconvenience to the displaced workers.

Suppose I work in industry X. Now, my job is eliminated due to productivity gains. Without State restriction of the market, I'll be able to enter industry Y and earn a comparable rate. Suppose a skilled worker in industry X makes a certain salary. Then, an equally intelligent worker in industry Y should make the same salary. Without State restriction of the market, workers would move from X to Y or Y to X.

One example of "Productivity gains are evil!" being misapplied is the software industry. Newer languages like PHP and C# really are more productive than Perl or C/C++. It is good that modern languages are better, and people are using them. The problem is that a worker with experience only in C/C++ can't get experience in PHP and C#. Due to a non-free market, nobody exploits the fact that there are experienced workers lacking the most current skills.

If it was a really free market, then some other skilled worker would start a software business and hire me. You might say "Start your own business, FSK!" If it really were that easy, then someone else would have done it already and hired me. It isn't as easy as it sounds. If I really want to be a business owner, I probably should do it agorist-style, to avoid the State overhead and State restriction of the market.

In a Communist economy like the USA, there's a fixed pool of jobs. Suppose that industry X loses 9,000 jobs due to productivity gains. Those displaced workers can't easily find new jobs, due to State restriction of the market.

Doctors/lawyers/accountants/banksters/etc. have their salaries directly backed by State violence. Productivity gains don't cause salaries to decrease. For many professions, innovation is illegal due to State regulations. If I think of a way to make the legal system more efficient, I can't implement it, because lawyers and the State have monopoly control of the legal system.

If some people have their careers backed by State violence and others don't, then those without State-backed careers have a huge disadvantage. Workers in an area with little State regulation then subsidize the profits of workers in heavily regulated industry. If you're using State violence to steal, then I'm at an economic disadvantage if I don't use State violence for steal.

The solution is not "I should lobby the State for favors! Then, I'm stealing as much as everyone else!" The correct answer is "Taxes and regulations are evil!" That's the fallacy of pro-State trolls who say "Software engineers should unionize!" or "Software engineers should lobby for more government regulations and licensing requirements!" Saying "Government is the answer!" is logically equivalent to saying "Violence is the answer!"

Due to State restriction of the market, it's hard for a displaced worker to start a new business. For example, I can't decide to start my own business selling food unless I make a huge investment in a State-approved kitchen and get a license. State licensing requirements are a barrier to entry to individuals trying to bootstrap a new business.

State restriction of the market creates the illusion that productivity gains are evil. Rather than reaching the conclusion "State restriction of the market is evil!", professional comedians instead say "Productivity gains are evil!"

As usual, blame is placed in the wrong area. Pro-State trolls blame productivity gains that cost people jobs. The real blame is State restriction of the market. Via taxes and regulations, the benefits of productivity gains go to insiders.

In a really free market, everyone would benefit from productivity gains. State violence prevents the free market from arbitraging away inefficiencies.


Anonymous said...

You are arguing correctly. But, playing a devil's advocate, I'd ask you where are the new jobs?

To explain their absence, you'd have to now tell the stupid workers a lot more economic explanations. Your chance of success? Zero.


Because, if those workers were so stupid as to initially believe that increasing productivity actually harms their well-being, then surely no explanations of more complicated economic matters can help.

The very first thing they are told by fascists in state schools is that there is no connection between the desires of other people and theirs. That the "job" exists for the purpose of "getting paid" and not that "getting paid" is simply a compensation for "doing the job" which is there to reduce the need of the one with money, i.e., the one who already reduced someone else need.

This is why children are forced to take government school, so that this could be hammered in their brains as a substitute for the truth. Once in, the consequences can never be changed, as even if that child learns different things later, their psycho is now built on the basic truths that was absorbed early in the life.

The rest of the government schooling is not important, it is there only to perfect the creation of another mindless being.

The main crime of government education, their whole purpose is to affect that one important moment.

As a result, you can observe absolutely astonishing things.

For example, you can observe many idiots running around trying to build a society based on "collective", on somehow caring for one another, and being "sustainable", and so on. I am sure you get the idea. What all these idiots want? They want to end the capitalism, end the money, and they frequently want to end the freedom.

Now, if you weren't a complete brainless piece of filth, wouldn't you stop and think, and then realize that money is simply an accounting for what you do for other people and the capitalism is simply a society hell bent on servicing the others?

See what I mean?

So, yes, you're right, but the explanation is useless as it it is more complicated than the thing being misunderstood.

You can not explain this to idiots, and those not damaged would not misunderstand the productivity to begin with.

Anonymous said...

I think software development as a "career" sucks. There is no career. You end up with a series of jobs that last 6 months - a few years at most. No employer wants to put into back into the system as regards training.

Then at the end of it all, a clown employer says that you can't be employed because having 5 jobs in 10 years means there is something wrong with you. This is despite that fact that a vast number of people have careers like this. Companies go bust, have bad business models, don't make money, get taken over etc. Unless you have a patron high up in a company you can't get a stable job.

Recruitment is a joke. It consists of dumb recruitment consultants simply looking at the very last thing you did and seeing if it is an exact word match to the job they are trying to fill.

They give no credit that a smart person can do slightly different things or can learn new skills themselves.

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