Saturday, May 24, 2014

Willful (Economic) Blindness?


NOTE: These 12 essays are being reproduced from my now defunct blog Random Notes, as I intend to cite them in my upcoming essay on the use of words will emotion-heavy connotations and little in the way of actual denotation (such as "need" versus "want", or "exploit" and "fair").

I was reading movie reviews this morning when I saw a sentence which, normally, I would have just groaned and ignored. But, having some free time this morning, I gave it more thought than it deserves, and realized how ignorant of history one must be to believe what was said.

The line? Here it is in its entirety:
However, this movie [h]as a deep sociological impact, in a country where inequalities are on the rise and unemployment is here to stay, thanks to globalization/technology that exacerbate the two. 
That's it. Your usual anti-technology/anti-globalization nonsense, from either the "green" left, or the protectionist/pro-union pseudo-right. (See "Misplaced Blame and A Power Play", "Remember I Predicted It" and "The Political Spectrum" for my reasons for calling it pseudo-right.) But, though we have all heard it before, have you ever considered on what basis this argument is made?

I was thinking about history, and I realized just how foolish this is, and there are countless examples to prove it.

Well, let us start at the beginning. "Employment" and especially "unemployment" is only meaningful in modern societies. Before we have substantial cities, there is simply no such thing as "unemployed" as those who don't work die of starvation. It is only once we accumulate a little money that we allow the poor the option of not working AND not dying. Which means, though no one really considers it, that the very existence of "the unemployed" is a sign of a charitable nature unknown in the distant past.

And chronic unemployment, long term, large scale existence without work is a truly modern phenomenon, mostly coinciding with the birth of the welfare state and unemployment insurance, though unions with plans for supporting those without work also contribute. Basically, unemployment is a phenomenon which exists because we are willing to pay people not to work, and the more we pay, the more we get. As I have said elsewhere ("The Endless Cycle of Intervention",  "Consequences", "Perverse Incentives", "When Help Hurts", "When Help Hurts II", "Subsidizing Irresponsibility and Poor Planning") we can have as much employment as we want to buy. All of which means it has nothing to do with "globalization" or, in the neo-Luddite theory, technology. (See "Cheap Lighters, Overseas Dumping and Monopolies", "Jobs, Jobs, Jobs, and More Jobs", "The Inevitable Corruption of Protectionism", "Protectionism Right and Left", "Fear of Trade".)

But, I wanted to make a truly simple argument, so let me ask, was there greater inequality in the primitive, trade-free medieval period, when serf toiled for lords using the most primitive technology? Or in the Renaissance when men with ambition could rise through mercantile or productive ventures? Is there more inequality in third world despotisms or in the western world? Was there greater inequality in the relatively primitive 19th century Russia of the Tsars, the more free England of Victoria, or the very free US of the 19th century?

Think of medieval Venice, where even the lowliest citizens risked their wealth on buying shares in mercantile ventures and seats on the ruling council were open to purchase from time to time. Or later Republican Rome, where elevation into the patrician class was open to those who could manage to be elected, regardless of origin. It seems in any society where merchants rule, ambition and ability allow one to elevate oneself, where, in states where trade is discouraged and technology stagnates, the social order becomes hidebound and castes become hereditary.

So, how can anyone who knows even a hint of history, or can see the world around them, think that technology and "globalization" case unemployment and inequities? Inequities of some sort will always be with us, as men will always differ in abilities and ambition. ("Life Is Not Fair - And Trying To Make It So Makes Things Worse", "The Threat of Perfection", "Utopianism and Disaster") But in societies that allow trade, that allow technological improvement, at least men will be allowed to seek their own level, and usually will drag the rest along with them, elevating their fellows as a side effect of their efforts to better themselves.

How can this be news to anyone in this day? Did they miss the entire communism debacle in any number of nations? What inspires people to imagine if we just shut our borders and turn our backs on progress all will be heaven? Do they not realize that we spent centuries climbing up from hunter gather tribes to modern civilization for a reason?

POSTSCRIPT

I do not mean to overstate the freedom or equality of many past nations. Rome and Venice had their problems, but compared to their contemporaries they were clearly the places I would have chosen as a home at the time. Of course, trade and technology is not a guarantee of freedom or improvement, states may implement many bad laws without totally destroying trade or economic growth, or at least without immediately destroying them/ But, in general, the pattern seems to be that those nations which allow progress in things technological, and which embrace trade, tend to also allow individuals to better their lot in life more than those states that do not, and, as a consequence of that policy, and the growth that comes from technology and trade, inequalities tend to decline.

One more note. In absolute terms inequalities may be greater in rich nations than poor, but that is only because of relative worth and the heights to which technology can lift people. Imagine a feudal farm where the peasants have the equivalent of $1 in wealth each, while the lord has maybe $20,000. Then go to a modern nation, where even many of the poor have more than that lord ever will achieve. Yes, the rich may have $100,000,000 making the gap between rich and poor much greater, but is it truly improvement to drop everyone back down to the level of that medieval serf? Or even the medieval lord?

Our poor have more wealth than the middle class or even rich in some nations, and certainly more than was common for the middle and upper classes of the past. That the rich have even more in no way makes the poor poorer. Would you rather be more equal but forced to live in squalor? I know some individuals may say yes, but for the life of me I cannot understand why. The only thing that matters to an individual is what he has. What others have does not change his own wealth. So, why would anyone impoverish themselves only because it impoverishes others more?

The only reason I can imagine is my old theory that envy leads one to truly destructive, senseless acts. ("Envy Kills", "Envy And Analogy")


Originally posted in Random Notes on 2011/03/31.


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