Routers and porn

[pastorlenny.livejournal.com]

Almost all of the discussions I am hearing about economics and politics seems to center on the various kinds of "lever-pulling" the government can do: tax policy, money supply, interest rates, etc.

While I don't doubt that this lever-pulling has a real impact on economic activiity, it doesn't seem to me to be what the creation of wealth is really about.  We add money to the economy and stocks go up.  Big deal.  It's just an anticipation of inflation -- not the actual creation of actual value.

Conversely, we might reform healthcare and education more aggressively.  Sure.  But it doesn't help to educate people for jobs that don't exist.  And physical wellness, whether we like it or not, is a function of wealth.  Drugs would cost money even if we nationalized pharma.   

If we look back through history, in fact, we will see that wealth has always been created be actual stuff: spices and silk, slaves and cotton, war production and automobiles, highways and consumer goods, routers and porn.

So I'm wondering what it is that the U.S. economy is actually going to produce to create wealth, jobs, tax revenue and human delight.  What will a 24-year-old community college graduate living in Dayton, Ohio be doing for a living four years from now?  Anyone have any ideas?

And can anyone tell me why this is not a more central topic of discussion generally?

Comments

[malasadas.livejournal.com]

I read an interesting story that a large number of Chinese companies are importing white people to sit around and make their company look more international.

I'm seeing a boom in exports right there.

[verytwistedmind.livejournal.com]

I posted this story in either TP or political cartoons last year. It was a very funny read.

[abomvubuso.livejournal.com]

I can confirm that first-hand.

[underlankers.livejournal.com]

Yes, colonialism had all kind of unfortunate impacts....though Dubai's a great job market for people whose only qualification is that. /half snerk half jeer.

[xforge.livejournal.com]

We already went here, (http://www.cracked.com/article_18817_5-reasons-future-will-be-ruled-by-b.s._p2.html) right?

[dwer.livejournal.com]

well, I'd hoped that there would be a breakthrough in several types of renewable energy technologies. That could have created lots of manufacturing jobs.

[pastorlenny.livejournal.com]

It does seem odd that these technologies remain sort of a footnote in our discussion of this country's economic future, doesn't it? Why is that?

[mikeyxw.livejournal.com]

Why would you assume that? If someone in the US invents a cold fusion engine tomorrow, they'd export the manufacturing of said unit by the end of next week. We're just not that competitive in manufacturing these days and should turn our attention elsewhere.

[the-rukh.livejournal.com]

Actually education does help us create goods. Goods are also things like technology that can be sold, which is then used to make things with the raw goods that are worth more, such as computers, more advanced cars, and very importantly, systems to process goods with less waste, more efficiency and less cost. Education can be pretty direct at the effect of economy.

Health too, if you have sick people they're not producing, fairly straightforward.

Both are directly beneficial to economy, lets not throw them under any buses, tractors, or ploughs.

Can you tell I'm avoiding a paper?

[a-new-machine.livejournal.com]

The big thing for the US since the advent of the service economy has been "technological innovation." And don't get me wrong, we do that OK, but a lot of the real innovation comes from other countries taking our research and using it in new and interesting ways. Microchips were made here, and perfected in Japan. Automobiles get designed here, and then perfected in Japan and Germany. A big part of this is our increasing distance from work. Mike Rowe has a good bit about the falling glamor of hard work in American society. Basically his thesis is that hard work is not long hours behind a desk, it's dangerous, physically demanding, and basic. It's the farmer who discovered that his cow's crap could be worth more than the cows that produce it, and makes a life out of shit.

I won't lie: I'm a part of that class that's running from hard work. I never even considered joining the military, which every man in my family had done in the preceding generations. I did work in a factory one summer - and I saw how it was faltering in the face of demand for the cheaper-to-produce products from the company's factory in Mexico City. Much of the remaining work at this plant comes from a patented, relatively high-tech process that the company is loathe to send elsewhere for fear of IP theft. I took a useless liberal arts degree in undergrad. Then I got out of school and worked for two years, and that was, at times, hard work. I cleaned ill-treated rental cars in sub-zero temperatures at 4AM. But still I wasn't really producing anything - I was part of a chain of tools used to produce something, I hope. People rented from us for business, and hopefully they eventually produced something. I'm now in law school, looking towards a career that will likely consist of helping one corporation sort out its ephemeral rights and obligations to another corporation or the government. But at the same time, I recognize that the US needs more productive, rather than simply distributive, jobs. If I'm successful, I'll be paid several hundred dollars an hour (or, my firm will) to take money from one company and give it to another. No creation, no product, just a cost for one and a boon for another. You can't make an economy out of that. Somebody somewhere has to be mining, making merchandise, or selling cars, or whatever. Innovation alone does not an economy make. A new patent may make a lot of money from licensing, but a part of me says that we also need to be creating the item, too. A single patent doesn't generate as many jobs as the grunt work needed to turn that patent into a marketable product.

So what needs to change? Unions need to start bidding against the world, not against the last contract. Our attitudes towards work need to loosen. Companies need to start reinvesting in the US workforce. The problem is that all of these things need to happen at the same time for any one of them to have a long-term impact. There are some signs of life. Intel, which had said that the cost of opening new manufacturing in the US was as much as $5 billion more than most other places in the world (mostly due to worker's rights regulations and environmental policy) has apparently backpedaled, and is bringing their new 23nm process to the US. Ford has made a profit on mostly union-sourced labor over the past 6 quarters, without direct monetary support from the government. Windows 7 is a success, Facebook is profitable, video games developers are making money in an increasingly fractured and competitive marketplace, and Hollywood has hit upon 3D for its next big ticket price upgrade. But real, sustained long-term industries - renewables, base-level construction inputs, technological components - haven't seen much growth in the US that wasn't led by government investment. I'm worried. But then I'm also hoping that the US can continue to ride its high until I'm old enough and rich enough to weather whatever storm comes along, and after I die, well, have fun sleeping in the bed we've made.

TL;DR: Manufacturing and product creation is a necessity. We need more of it, and labor, business and society need to work together to promote it.

Re: Can you tell I'm avoiding a paper?

[pastorlenny.livejournal.com]

This was delightfully substantive. Try not to make it a habit, wudja?

What's the paper on?

Re: Can you tell I'm avoiding a paper?

[ninboydean.livejournal.com]

The problem isn't unions. Its the corporate bureaucracies coupled with advanced financial instruments such as derivatives which are overshadowing production.

Karl Marx pointed out that the production process was simply a hindrance to the capitalist - if he could, he'd forego the whole process of transforming his money into products and back into money, and go straight from money-to-money.

And this is what derivatives and securitizations seek to accomplish. By investing in bets for and against different firms, commodities and nations, capitalists can make a lot more money than they ever would by producing commodities.

Why hold your breath for their investment?

Re: Can you tell I'm avoiding a paper?

[a-new-machine.livejournal.com]

Thought this (http://www.examiner.com/geopolitics-in-national/u-s-needs-to-actually-make-things-to-compete-the-global-economy?sms_ss=reddit&at_xt=4cd3d4c0dfc4350a,0) on point, figured I'd throw it out there as well.

Re: Can you tell I'm avoiding a paper?

[gunslnger.livejournal.com]

But when the economy is global, any one country doesn't have to do the actual manufacturing to be successful. Just moving money around and/or providing the tools to assist the manufacturing and/or providing the innovation and direction for the manufacturing is just as good.

[mijopo.livejournal.com]

A Michigan woman recently sold a letter from obama for $7000 (http://www.npr.org/templates/story/story.php?storyId=131002541) Seems to me that we should just have famous people create memorabilia. that and bullshit, as discussed in the story xforge linked to, look like promising areas of wealth generation to me.

[badlydrawnjeff.livejournal.com]

So I'm wondering what it is that the U.S. economy is actually going to produce to create wealth, jobs, tax revenue and human delight. What will a 24-year-old community college graduate living in Dayton, Ohio be doing for a living four years from now? Anyone have any ideas?

Keep in mind that we're in a really weird time right now. Five years ago, Facebook didn't exist. 10 years ago, "social networking" wasn't even a thing. The kid entering college right now may have jobs available to him when he graduates that aren't even thought of yet.

The problem is the mentality that you share here:

If we look back through history, in fact, we will see that wealth has always been created be actual stuff: spices and silk, slaves and cotton, war production and automobiles, highways and consumer goods, routers and porn.

Yes, wealth used to be "actual stuff." No more - we're now an economy that peddles more than things, but instead peddles services, ideas, and other fanciful ideas that my grandfather would likely have scoffed at. We're a society that favors innovation over interchangeable parts, and there's work to be done to acclimate the economy again to this.

We'll get there, though.

[a-new-machine.livejournal.com]

Facebook, though, is really just the next generation of television. It's entertainment to draw us in, and ads to make money. Certainly it's an innovative way of doing that, but I don't think you can say that it produces real wealth in the same way that durable goods like cars, buildings, and electronics do. Of course then we've got the question of what "real wealth" is...

[pastorlenny.livejournal.com]

So we can export enough IP to make up for all the food, plumbing supplies, consumer electronics, automobiles, fuel, and clothing we actually need to live?

Want to compare total GDIP to total domestic consumption?

Or are you saying we can create anough IP on both coasts to basically put everyone between Pittsburgh and Des Moines on welfare?

[box-in-the-box.livejournal.com]

The problem being that the profitability of social media is vastly overplayed except for a tiny fraction of the population — ask Twitter when they expect to finally start turning a profit.

Likewise, while this is an excellent topic for discussion, I was mildly amused by the OP's assertion that porn still constitutes a material good that can create wealth, when as Cracked.com (http://www.cracked.com/article_18817_5-reasons-future-will-be-ruled-by-b.s..html) pointed out:

If I gave you a budget of zero dollars and said, "Get me as much Internet porn as you can for that amount of money," how much porn would you come back with?

I'm thinking the answer is, "All of the porn."

[...] There's more porn than air now. Literally — air is limited, but we have machines that can convert energy into .jpegs of titties from now until the heat death of the universe. Titties are post-scarcity.

That being said, his overall point holds — it's literally impossible to enforce artificial scarcity on anything that can be converted into digital data, which is pretty much the majority of the market now.

[ninboydean.livejournal.com]

Are you implying sir that wealth is created by labor? What a blaspheme.

[pastorlenny.livejournal.com]

Yup. Trading derivatives is hard effin' work. :P

[meus-ovatio.livejournal.com]

I think the question is more about what is our next growth sector. There will always be the latent force of pure staple economies for a nation of 315 million people. The problem is that if we grow in population, we have to grow the available jobs to keep up, and if there is no growth sector to soak it in, you're going to have structural unemployment due to all number of things: increased efficiencies and technologies for one. We simply, IMO, will not have 4-5 percent unemployment for decades to come. This is the new reality. Our economy has a built-in section of unemployment and there is nothing to do about it. Everything else is people making promises they can't keep. When dealing with structural shift in the economy, the government can't just wave its wand and make things better. Tax cuts don't produce jobs that don't exist. Raising taxes just balances the books in the short-term.

My only comfort is that in 40 years, everything will be better, once the glut of baby-boomers passes on and we're not longer dragged down by all those oldsters!

[pastorlenny.livejournal.com]

I think the question is more about what is our next growth sector.

Yes. Maybe I should have just posted this single question.

So what is our next growth sector?

we're not longer dragged down by all those oldsters!

I'm not dragging anyone down. I am the wind beneath your freaking wings. Don't ever forget it.

[ccr1138.livejournal.com]

I think this SHOULD be talked about more, but perhaps the media doesn't want to address it because what it really comes down to is this:

Government very rarely contributes to the creation of wealth. Almost all wealth (except infrastructure) is created by the private sector. You can't have growth in wealth by moving little green pieces of paper around; you have to create something new, using resources and labor, that adds to the general pool of "stuff" on the earth.

Conservatives want to move more money back into the private sector which creates wealth. Liberals want to take money out of the private sector and redistribute it, which not only creates NO wealth, it actually stifles wealth creation, because it takes the most from the very people who are in the best position to employ labor, buy resources, and make "stuff."

[box-in-the-box.livejournal.com]

Speaking as someone who works in the media, the reason is much simpler and more self-serving — the media knows very well that artificially enforced scarcity is the only type of scarcity that exists for most of the market anymore (http://www.cracked.com/article_18817_5-reasons-future-will-be-ruled-by-b.s..html), and that's more true of the media itself than anybody, and the problem with artificially enforced scarcity is that it's ultimately unenforceable, and if scarcity is unenforceable, then the free market is permanently fucked forever, for the very simple reason that a nigh-infinite supply creates a virtually nonexistent demand.

[redheadrat.livejournal.com]

There are dozens of professions and skill sets on BA/BS level that are not going anywhere, but where the majority of workers are earning mediocre wages, so if the future college grad wants basic stability, he can go towards one of these. Examples: nursing, clerical, technicians of all sorts, processing accountants, restaurant managers, etc.

Then there are jobs that require constant work and study from the worker. Most IT jobs fall into this category. If worker falls behind the trend, the job will be gone.

Another level up are jobs that require extensive training before doing anything. Usually coming near those jobs with a bachelor's degree is impossible. But a college student with passion can explore those routes into medicine, law, etc.

But the best jobs are the unknowns, they revolve around new trends and technologies and the workers earning their money at these jobs distinguish themselves by the ability to learn something very different fast. These kind of workers are by all means universal and often they will have completely "meaningless" degrees in stuff like philosophy or mathematics.

As to creation of wealth by widget production, it is long gone. Quality and efficiency of automated robotic labor is much higher and workers are needed to design, maintain and run the machines rather than hammer out the widgets.

[anfalicious.livejournal.com]

I'm sorry, are you suggesting that IT requires more skills updating than nursing? If so, you don't understand what nurses do these days; they aren't florence nightingale anymore. Many are as qualified (in terms of time and effort invested) as doctors. The medical field changes just as quickly as the information technology field, given how interwoven they are.

[http://users.livejournal.com/-wanderer-/]

What will a 24-year-old community college graduate living in Dayton, Ohio be doing for a living four years from now?

Considering going back to school for a business degree (using loans!) so he can scramble for a piece of the middle class pie. Nothing against business degrees per se, but the number of 20-somethings that pursue them with a passion nowadays is alarming. It's a cynical generation.

I think that you are just going to see some decline in people's standard of living, just because getting to a middle class lifestyle is going to be harder and harder. Or rather I think that people are going to scramble harder to maintain that level of income, which is already happening to some extent. Ideally people would just dump the stuff they don't need (which is a lot), work less and pursue more interesting / meaningful activities in their free time. I won't hold my breath though.