Three Scenarios: Productive Societies

Imagine a world where 10% of the population can produce everything needed by everyone on the planet.

Now imagine that you are sent to rule this planet as a benevolent dictator. 

Scenario (1):
When you arrive you find that 90% have the people have the enslaved the other 10%, forcing the minority to work, while the majority take it easy and live off what the minority produces.

You immediately call a meeting of all the people.  "This isn't fair!  Nine out of ten people are living off the backs of the few that are doing all the work!"

The non-workers respond: "The workers get exactly the same share that the non-workers get, share and share alike.  And there's not enough work to keep everyone busy; SOMEBODY has to do the work.  And this is the system we've worked out."

You're the (benevolent) dictator.  What do you do?

Scenario (2):
When you arrive you find that although 10% of the people are producing enough to support everyone on the planet at a comfortable level, what they produce isn't supporting everyone at a comfortable level.  The workers live luxuriously in walled cities, with every comfort and convenience they can imagine.  Outside the walls 70% of the planet's population lives in unemployed poverty.  The remaining 20% are employed in the cities at low wages, serving the productive 10%.

You immediately call a meeting of the leaders of the productive 10%.  You say, "This doesn't seem right!  Have you seen conditions outside your walls?"

The productive 10% reply: "There's nothing wrong with our system.  We're the ones doing all the work!  We have a right to consume what we produce.  Most of the people outside the walls don't do anything.  Why should we support them?  The fact that the 70% can survive at all is mostly due to the fact that we employ the 20% in our restaurants and shops.  If it weren't for us, the 90% would starve!   It's unfair for you to suggest that what we produce should be taken from us and given to people who aren't producing anything.

You're the (benevolent) dictator.  What do you do?

Scenario (3):
When you arrive you find that 10% of the people are producing enough to support everyone on the planet at a comfortable level, and those 10% are living at a comfortable level, but the other 90% are split into two distinct groups:  87% live in dire poverty,  but the remaining 3% live in great luxury.

You call a meeting of the rich 3%:  "What's going on here?  Why are you so wealthy when 87% of the population is impoverished?"

The rich 3% explain: "The only reason that 10% of the population can produce so much is that our parents and grandparents were clever and inventive and industrious.  They developed techniques and machines and organizations that increase productivity immensely.  There's nothing special about the 10% who are now working, and we can prove it!  We can fire any of them at any time, and replace them with someone from the impoverished 87% without any trouble at all!  It's our machines that do the work.  Our grandparents and parents sacrificed a lot to develop these machines for the benefit of us, their children.  We deserve the things our families' machines produce.  The 10% are lucky to be working at all.  And the 87% aren't doing anything; they don't deserve anything.  If any of them want something, they should be like our grandparents and create a machine that is as productive as our machines.  They're free to do that anytime they wish.  But bear in mind: if they want to play in the big leagues, they better come prepared to play!  Productivity is the name of the game, and we're the most productive people in history!  That's why 10% of the people can produce so much, and that's why we deserve every dollar we earn from our factories.  It's not our job to help competitors."

You're the (benevolent) dictator.  What do you do?

Economic growth and more jobs aren't always good for the nation

There's an incorrect assumption that economic growth and more jobs are always good for the nation. Here's a simple counter-example:

 

The majority of people in the U.S. are overweight or obese. Clearly many people eat too much, and too much of the wrong things. But think of the impact of this overeating on economic growth and job creation: Overconsumption of food means we have to create more food; creation of more food means more jobs. Obesity has negative health effects: more injuries, more heart problems, more diabetes, and more complications when treating illnesses and injuries. This requires more people in the healthcare industry: more jobs! So over-eating results in economic growth and job-creation while at the same time reducing the overall health of the nation.

 

If we had a choice between between

• (a) employing people to produce extra food, and to take care of people suffering from overconsumption of food, and
• (b) having a healthier population, and eliminating all the work involved in overfeeding and caring for the overfed,

why would we want to choose option (a)?  Focusing on economic growth and job creation does lead us to choose option (a)!

 

One explanation for choice (a) is that we shouldn't be a 'nanny state': if people are foolish enough to make bad decisions, we don't have any business telling them they're wrong. (We literally 'have business' resulting from their foolish choices!) The free market says that everyone should be free to make their own choices. The problem is that in our example, encouraging people to make bad decisions is good for the economy. Is that what we want to do?

The real issue concerns distribution of resources. All the people employed to overfeed and care for the overfed 'qualify' to be part of the economy. The overfed pay their wages, if they can. If the overfed can't pay their wages, then the rest of us end up doing so. It would be more efficient for the overfed to eat less, and simply pay the overfeeders, healthcare professionals, and caretakers for doing nothing. But if the overfeeders, healthcare professionals, and caretakers weren't doing anything, how would we distinguish them other people who aren't employed? In effect, we're paying people (including some highly trained healthcare professionals) to do 'busy work', at the cost of our nation's overall health. This is foolish.

 

I'm not saying that alternatives are obvious, or than any alternative system must be superior to what we have now. What I am saying is that alternatives should be imagined and considered.

The assumption that economic growth and more jobs are always good for the nation is incorrect. Our focus needs to be on doing what is good for our nation (and the world). This is not the same thing as promoting economic growth and job creation, despite what economic leaders want you to believe (and probably believe themselves).