Tuesday, April 6, 2010

Laziness in economy: minimizing employment

When a human being sets to work on a task, he is compelled to complete that task in an efficient manner. In conceptualizing the task, he will have in mind some standard of quality, and go about the task with the goal of achieving that standard with the minimal expense of thought, time, resources, and muscular exertion that his expertise and available technology will allow, that is to say, to conserve effort. Typically the final result is somewhat below the standard of quality originally envisioned, but such results are tolerated by both the individual and society. This process, endlessly repeated through all the endeavors of human day-to-day life, is evidence of a governing principle of laziness that is more intimate and real, more potent in human events than any alleged "rationality" could ever be.

Here, the notion of laziness as a governing force does not imply a psychological or moral defect in the individual. Though the term technically refers only to the urge to shirk one's duties, laziness can also be seen as a pervasive force that expresses itself throughout our economic reality as a potent psychological drive to minimize effort. While a person who shirks an important duty is often punished by society, a person who does unnecessary work is often punishing himself. Even as those among us who work harder than the average win our praise and gain various types of prestige, they find themselves stressed, malnourished, culturally deprived, drug addicted, and even psychologically disturbed or physically injured. Laziness can be seen as a countervailing force, pushing back against desires to achieve and resisting unreasonable requests. Moreover, laziness is not the negative of effort, as it seems to play a role in the direction of effort. It is laziness that so often compels us to devise more efficient means in our day to day life.

Laziness is unfairly villainized within common discourse. Western society seems to retain ideas of work ethic that have their origins in feudal peasant agriculture. In such times, all work was of utmost importance. Each additional hour of labor either fulfilled a basic need or settled an obligation to a lord who dominated his vassals. Among the lowly peasants, there was never a need for each individual to independently judge others - the slackers would be dealt with systematically. However, among the more affluent, it was always possible to fake things in such a way that it brought harm and detriment to others. All social classes (distinct or arbitrarily divided) are lifted on a sea of secrets and conspiracies, by a political process. Rules are both protective and restrictive. As a person rises toward a position of power, additional burdens manifest themselves through the absence of these rules: the fledgling rule-maker discovers there are rules for making rules. In its essence, human power always flows from the consent of others to one's authority within an organized structure, that is to say, from unanimous consent of those who immediately receive orders. This consent is based primarily on evidence of ability to act in various capacities that illustrate the consent of others. It seems that all things that an individual seeks to acquire become objects not merely in themselves but symbols of the ability of that individual to acquire things, that is to say to obtain consent. Competition for acquisition sometimes develops over time, gaining conceptual depth and its own lexicon even as it remains fluid and somewhat undefined. Concepts of fashion and entertainment are examples of such competitive processes. Even though there is no wrong in losing such a competition, the losers must recognize the power of the winners, and in doing so, some agendas are advanced ahead of others. Moreover, the stakes can be very high: loyalty is itself a cardinal virtue (crimes such as treason come to mind), but in a broader sense loyalty to a cause is just one of many expressions of the authoritative consent required to further any ethical goal. Because of the limitations of the human mind and the limited flow of information, evaluations of the actual effect of any command passed down from an authority is typically exceedingly difficult or impossible for the average citizen. That is to say, our moral theory is subject to profound manipulation. It allows political processes controlled entirely by others to determine arbitrary tasks that we have a duty to complete. This in turn leads to a common perception of laziness that is based on the individual completion of these arbitrary tasks - and stacks endless obligations onto the psychology of the morally conscious individual. As an inevitable aspect of political reality, a profound skepticism of these obligations has likely been instilled into human nature - but ironically this skepticism is not expressed as a skeptic might express it. Though a skeptic might object by voicing technical objections to aspects of theory or illustrating absurd conclusions, he has still been captured by the structure, made to participate in its evolution. The only reprieve for the individual from these endless obligations is to focus on those concrete needs and wants in his immediate sphere - those things he can verify with his own eyes and address with his own hands. But as a person advances within society or as a society advances within a population, individuals find themselves more remote from both from suffering and from the means to address suffering.

In response to this dissonance, there is a great struggle within the discourse of a society, played out both on the public sphere and within the consciousness of participants and observers, to label factional allies (including the self) and enemies with politically charged descriptive terminology that imply various motives and behavioral tendencies. Within this context, the individual is compelled to labor. Even his freedom to pursue various leisure activities is in fact heavily structured: those things which individuals pursue for personal enjoyment within any society are invariably things which identify them with an immediate social group that wields some degree of political power and a more distant network of allegiances and animosities - consciously or unconsciously, an individual obtains dual purpose from his leisure. Indeed, all people have a secret and private set of vices that are publicly unmentionable, but in their own way these follow the same rules. It is questionable whether leisure itself is a motivating factor, or if some other psychological drive motivates the action, with the enjoyment of the activity being an internal aspect of some external, symbolic display. A motivational spectrum develops for the purpose of judging others, couched in a variety of explanatory terminologies, having both a negative aspect and a positive one. A person who does not labor enough can either be lazy (economics or business), of poor character (religion or philosophy) or mentally unhealthy (psychology). A learned person in any of these fields is less likely to emphasize such a concrete and real application of theory - he knows that the overwhelming lesson of education is the realization of how little is actually known in any of these disciplines. These terms and thinking techniques, rather than being illuminating of the problem, are rhetorical devices "painted over" the underlying logic of work ethic inherited from the agrarian peasantry. Ironically, the political act of judging laziness has lived on in (and is just one of many examples of) pedestrian misconceptions of academic discourse which preserve political devices that are detrimental to social welfare.

First, consider the negative aspect of this spectrum, expressed as various political acts harmful to the individual. The threat of these acts is ever present, as the typical member of a society sees their wrath visited on strangers, friends, coworkers, bosses, and subordinates. The fear, disgust, and stress that this induces forms a negative motivational spectrum that drives the members of a society to work hard, to present themselves as if they have done more work than they actually have, and to demonstrate their own allegiance to such values by joining in the ridicule and punishment of shirkers.

The positive motivational aspect, though superficially less harmful, shares many of the worst features with the negative. Here, the glittering jewels of recognition, promotion, and reward shimmer in the distance. The individual finds that recognition from unimportant individuals is easy to obtain, however it is problematic because it is typically meaningless and in a technical sense, false. As a result, he finds this recognition unsatisfying and thereby cultivates a torturous ambition, or he constructs a false belief that the recognition does have a deep meaning and thereby falsely elevates himself and the person who has recognized him beyond the position that the actual merit of his actions would normally imply. Within the relativistic soup of social reality, individuals will at times come to see the absence of punishment as reward, or the absence of reward as punishment. The only clear delineation between the two is in the mind of the authority responsible for declaring who will receive what. Promotion, properly speaking, is a type of reward but one implying potential rather than achievement. Therefore, its converse is also implied: a person passed up for a promotion is a person with less potential.

Over the ages, those who do work have applied their ingenuity to the tasks at hand, bringing about new ways of doing things (technologies) that reduce the load of work required for the completion of individual tasks. The effect of this development has been twofold: first, the individual finds that rather than being required to do less labor, the new technology is used to justify a higher level of production from each individual; secondly that as new technologies are developed, the complexity of production and therefore the hierarchical authority required to undertake each endeavor increases.

The cause of the first effect is the negotiating imbalance between the firms who offer the wages, and the workers, who provide the labor. It is not easy to summarize exactly why this persistent imbalance exists. In a deep and remote sense, the division of labor between the proletariat and capitalist class evolved from the division of labor between the lord and peasant. If the economy is seen as a dynamical system, could there simply be no force in effect to correct the initial imbalance, which has persisted like a standing wave to the present day? The proximate causes seem decidedly less satisfying but much more actionable: first, because there are many laborers, in persistent surplus and fewer firms; second, because firms are well informed relative to workers; third, because firms have the power to wait while workers must meet their immediate needs; fourth, because firms have political power. In the middle, there are revealing points, possibly the keys to the whole question: first, that the flow of currency through an economy is effectively constrained by the actions of the peak wealth accumulators, who desire to make money, meaning that the net flow is from the economy to them; second, that physical land and other essential resources of production are typically wholly partitioned in an unequal fashion, with firms investing to produce goods only when additional resource rights acquisition is unprofitable; third that worker budgets can never purchase the entire product of their own labor, thus only the constant increase in production from each worker can pay the rents associated with food, shelter, courtship, child raising, and everyday life.

The cause of the second effect is the basic nature of technology itself. Each element of a technology occupies a part of the human mind. The human mind is finite, thus, as technology developed, a threshold was reached beyond which a single mind could no longer contain all of the understanding required for technological processes. Those who share the process of understanding inherently engage in a political struggle for control of the means of production. In times when technology was simple, hierarchies could also be simple, but nowadays sophisticated management techniques are necessary.

The question of economic management is often posed as a question of how to increase production, raise the "standard of living", and limit unemployment. It is becoming clear that the unchecked desire to produce is destructive to the environment. Unexamined metrics that show increases in standard of living have also failed to correlate with individual happiness. Could it also be the case that increased employment can also be without benefit, or even harmful to the individual and the society?

Intuitively, the force of laziness indicates that there is a spectrum of employment within which an optimal point or region exists for a given level of production (unless production is measured poorly). Work has several dimensions: first, what type of work is being done; second, how are working hours distributed through the worker pool; third, how enjoyable is work for each worker?

The first question relates to appropriate levels of production and correct measurement of standards of living that reflects real quality of life. This question has been voluminously explored at www.stiglitz-sen-fitoussi.fr and I will not devote much time to it here. The answers to questions about where production ought be directed are clear. If society has the capacity to produce sufficient food that nobody goes hungry, ought society do so? If society has the capacity to build and organize cities in a way that everyone can live in the type of community they enjoy, ought society do so? If society can implement policies to protect the natural environment without harming its citizens, ought it do so? And, if the accumulation of property, patent rights, capital, and political power becomes injurious to the public good, ought the society vigorously pursue measures to correct such imbalance?

The third question relates to the inherent hierarchy of work. While some jobs are not enjoyable, others are. Concepts like the "career"might be satisfying for professionals, but other, more flexible concepts of work duties might better serve blue collar workers who work in a factory and repeat the same motion mindlessly for 40 hours a week. Civic education does not need to stop after high school - blue collar workers could have rotations and exchange programs to break up the monotony of life and to add perspective and pride to their role in industry.

The second question relates to the utilization of technology - if production is constrained to only production that increases quality of life, then there is no guarantee - in fact there is evidence against the idea - that there will be sufficient demand to provide employment at current standards of working hours for all. Thus, work must be partitioned between individuals in some way. When compared to the previous two answers, this one is by far the most radical. Yet it is the most provable of all three, and the most easily addressed by public policy.

Creating institutions to enforce a fair division of work is preferable to creation of a welfare state. In the broadest possible terms, the most general analysis possible creates three categories of possible work policy for a society. The first category are the societies that do not enforce a fair division of labor or provide unemployment services. In this system, the persistently unemployed depend on the charity of private groups in order to survive. This grizzly state of affairs is surely bad for the society as a whole, as there is little, if any, marginal benefit to those who do work and those without it suffer tremendously. The second category are the societies that do not enforce fair labor division but do provide unemployment services. These economies are divided into two overlapping classes: the middle and upper classes (hereafter called just upper class) who work hard, make significantly more than the minimum wage, and are engaged in investment and savings; and the lower class who may work hard but make close to the minimum wage, are moving frequently from one job to the other, depend on unemployment, and have either building debt or a lack of coherent investment and savings strategy. These two classes overlap because some investments always fail, some households have bad money management, and because of luck. Here, the extra labor hours that the upper class work relative to the poor generate some amount of extra wages. The poor, who are persistently unemployed and depend on social services, absorb some of these wages through the costs of their social programs being paid through progressive taxes that are visited on the upper classes. Thus, the situation is unfair to both the upper class, who must to some degree labor without compensation, and to the lower class who must go without work and the opportunities for advancement and life enrichment that work offers. The third option, the division of labor between all individuals in a society, with no long term unemployment compensation necessary, is the preferred policy. In this system, a limit on each individual's working hours is strictly enforced. For instance, the work week can be defined (such as it is now) to be only, say, 40 hours in a week. But no individual would be exempt from this. For example, if a scientist wants to work 60 hours a week on his research, he must be compensated as if he worked 20 hours of overtime, that is, paid 1.75 times his normal salary. Therefore, Universities whose policy it is to work their scientists more than 40 hours a week would be encouraged to hire more of them. This policy would then be coupled with a definition of the workweek that could be reduced based on unemployment trends. Very roughly speaking, to correct for 10% unemployment, the work week need only be reduced 10%, provided that a means exists to ensure that salaried individuals also work 10% less. This system is superior because no wealth transfer is necessary between the upper and lower class. Thus, the labor and compensation are brought into harmony.

In order to bring about an economic system focused on the fair division of labor, the ideas of work ethic that have been inherited from ancient times must be challenged. The matrix of insidious concepts that are tied to the work ethic ideal mean that this debate will be played out in numerous academic topics that seem entirely unrelated to the ideal of work ethic. But when the underlying assumptions of academic theories are laid out in detail, so often the most innocuous and basic things turn out to be incredibly complex, hiding places for endless preconceived notions. Social sciences have in general strayed too far from philosophy, and philosophy has strayed too far from its own roots. In physics, it took over 1000 years for the basic ideas such as motion and inertia to root before Isaac Newton was able to introduce his core concepts in an almost entirely philosophic work, the Principia Mathematica. If social science is to follow natural science, it must focus for some time more on the building blocks, both in experiment and in discourse. This essay has been illustrative, in part, of the simple solutions that emerge to vexing social problems when the building blocks are examined in detail.

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