A response to a critique of “Why Capitalism Creates Pointless Jobs”

Why Capitalism Creates Pointless Jobs

It’s as if someone were out there making up pointless jobs just for the sake of keeping us all working.

[My response to Kimock’s critique – rather than the original post itself.]

Hi Kimock

There is some truth in your assertion, that an understanding of some of the fundamentals has not been clearly demonstrated, and your response suffers from a similar (though one step deeper) lack of understanding about fundamentals.

The fundamental that is most important at this time is that markets must value any universal abundance at zero.
That is, anything that everyone has all they need of, has no market value, irrespective of how important it is, like the air we breath.
In the case where things are naturally abundant (like air), you can say – yes, that’s entirely sensible. And that could be argued as a reasonable position when there was only a very tiny set of such universal abundance possible (air).

However, that has now changed.
Now technology allows us to produce a large and exponentially expanding set of goods and services in universal abundance. We have that technical capacity. Having owned and operated a software company for over 30 years I am far more aware than most of that fact.

The incentive under capitalism is to make profit.
To make profit, there must exist scarcity.

Most of the laws in any jurisdiction are about creating such scarcity.
Some do so explicitly, like Intellectual Property (IP) laws, copyright and patent etc.
Others are much more stealthy, and fall under the broadest possible heading of “health and safety” which includes most of the guild laws requiring qualification (be it medical qualifications or a trade certificate, or whatever).
In all cases, whatever their public rationale (whatever the sales pitch used to get them through the many levels of whatever legal process exists), the practical outcome is to prevent universal abundance by the imposition of artificial barriers to such abundance.

10 minutes on the job training can have someone being productive in a narrow field, in most cases. Sure, we all increase the scope and depth of our knowledge as we gain experience, and the evidence is clear, most people only need a couple of hundred hours of school room instruction to learn the basics of reading and mathematics, and then they learn best by engaging in something that actually interests them – only a very tiny minority find that in classrooms or any education system.

The real fundamental issue is that markets are internally incentivised to prevent the emergence of universal abundance, which is what most of those in really high paid jobs actually do (in one way or another – certainly lawyers).

The real fundamental issue is, that right now, we possess the tools and resources to meet the reasonable needs of every person on the planet for air, water, food, housing, transport, communication, energy, education, healthcare, sanitation, security, and freedom – but actually delivering such abundance would break the capitalist system (any system based on exchange or markets).

Capitalism is a very complex multi leveled system that in times of genuine scarcity one could make a reasonable argument was actually in the genuine interests of life and liberty for most people.

In an age of exponentially expanding automation, one can no longer make that argument with any level of integrity or coherence.

Our exponentially expanding productivity has outgrown the scarcity based value-set that gave it birth.

We need to transition.

It is in everyone’s interests to make that transition as peaceful as possible, and of benefit to everyone (right across the capital distribution spectrum).

I am confident that can be done.

I am without any shadow of reasonable doubt remaining that it cannot be done within a market based set of values.

We require something else.

I seems clear to me, that a universal respect for individual life, and individual liberty is such a viable set of replacement values.

That actually requires each and every one of us to think about how we can secure our own lives, and the lives of everyone else. Killing anyone is not an option – ever!
The military industrial complex must go – and we must do that in a way that is as stable and secure as possible (at all levels).

Liberty, freedom, can never be without constraints.
In complex systems, it is constraints that deliver form.

We only exist because of constraints – from the subatomic levels on up.

Meaningful freedom exists within constraints. And to be clear, I am not saying that our current sets of laws are appropriate constraints, and they are what they are, one level of constraints in a very complex set of levels of constraints.

So we live in interesting times, and we really do need to understand the fundamentals – without necessarily believing any of the dogma from our history or cultures associated with those fundamentals.

[followed by]

Hi Dave

I share your love of freedom, and I take it a level further than you seem to demonstrate in your posts here.

I agree that in the past, a strong case could be made for the association between market freedom and human freedom.

And things are changing.

In the past, we really did need most people to make active contributions in order to support us all.

With modern automation, it is very difficult to make that case.
With automation it is easy for 2% of the population to oversee the automated production and distribution of all the reasonable needs of the other 98%. In a very few years that number will halve every year.
It is now clear that we could easily meet the reasonable needs of every person on the planet, for all the necessities of life.
And markets always value universal abundance of anything at zero or less.

Ensuring that everyone had a Universal Basic Income, is one possible strategy for transitioning away from free markets as a dominating force in human society and moving to a system far more tolerant of diversity (including the diverse notion of not engaging in market activity).

Creating a situation where people must either participate in markets or die is hardly freedom. It has some very strong correlates with control (a similar level of control to communist states, just expressed differently).

Real freedom must allow a reasonable level of freedom even for those who, for whatever reason, choose not to participate in markets and exchange.
People can be very productive, without selling anything.
Just because someone doesn’t participate in marketing anything does not equate to them not being contributing members of society, or any sort of bludger.

There is a bigger dimension of freedom here that you do not yet seem to appreciate.

[followed by]

Hi Trevor,

Point 1 – agreed, I did not make the claim that any market system led to freedom universally, and I think a reasonable case can be made that freer markets tended to deliver more freedom to the population generally (rather than the sort of trading guild system whereby one required dispensation from the king in order to trade for example). And one can also argue the toss as to which end of the spectrum the increase in freedom approached from – complex systems are often like that.
I was only agreeing with Dave in the sense that one can make a reasonable case for the claim he made.

Your point 2, I can generally agree with, and there are some fundamental problems in the system Marx outlined, that still deliver significant issues for those of us committed to freedom (and I am also being explicit here that the sort of freedom I am committed to is one subservient to valuing sapient life universally, and is within a responsible social and ecological context – so not the free to follow whim sort of freedom, but something much deeper and more powerful). The issues are around taking anything from anyone, and who decides. With automation, such issues can be circumvented, as the automated systems make and deliver whatever is reasonably required (and there is a test of reasonableness, and such a test cannot have hard boundaries, but must remain infinitely flexible and extensible as required).

Your point 3, that is more difficult. If you adopt a simplistic definition of something, it becomes tautological. The term capital has an interesting etymology. It comes initially from meaning the head, invoking ideas of control, and from thence developed into a designation of the seat of power, and then to mean the prime mover in a corporate venture, and eventually to meaning money more generally. It is an indicator of the sort of stealth take-over of the abstract concept of money – that it now names itself the head of things. It isn’t.
The most productive thing any of us have is our own brains.
It is ideas, and the technologies developed from them, that allow us to produce more with less, faster than our population is growing.
And certainly modern communist states tend to be towards the more totalitarian end of the spectrum of state control, and that isn’t always the case.

Your point 4, Socialism. I see too many dangers for freedom in socialism. I fear the tyranny of the majority as much as the tyranny of any minority. Real freedom can only exist where all the necessary conditions for life and liberty are completely distributed (decentralised), and individuals have complete freedom about which, if any, social groups they engage with.
We are a social species, and most people enjoy and choose social interaction at many different levels.
I am not a socialist.
My highest values and individual life and individual liberty, applied universally, and that requires the exercising of many levels of responsibility in both social and ecological contexts.
I am capable of extensive delayed gratification. I can accept far below what I am capable of taking in the present system, because I can see the potential rewards available from exponentially expanding technological capacity if we transcend the existing systems to ones capable of dealing sensibly with universal abundance of all the essentials of life and liberty. I can deal with relative poverty now, to create that sort of abundance in my medium and long term future.

[followed by]

Hi Trevor

Have you actually read Marx, read the communist manifesto?

It is framed as a class struggle.
The Manifesto states quite explicitly “In this sense, the theory of the Communists may be summed up in the single sentence: Abolition of private property.”
If one abolishes private property, then either one has no security, because anyone can take anything at any time, or one is subject to the control of the group in all things (as most meaningful actions require the use of property).

Marx took one approach to the problem of asymmetry of power through control of the means of production – to make it a function of the group.
I take an entirely different approach, to personalise it, through advanced automation.

I am about first the right to life of every sapient entity, every entity capable of naming itself, and conceptualising of itself as an actor in its own model of reality.
Secondly I am about the freedom of all such entities to do whatever they responsibly choose.

And responsibility is much more than whim.
Evolution seems to have equipped us with many heuristics that do not serve us well in a modern context – example our liking for sweet things. At the time we evolved such a liking the only source of sweet things was ripe fruit – that worked well both for us and the plants, as those fruit contained thousands of different nutrients we needed. Doesn’t serve us nearly so well when brand name sugar water comes in containers at the supermarket, and provides calories devoid of nutrition.

That is a rather straight forward, and extremely well documented example, yet we still allow such things to be promoted, even when the link to cancer, heart disease and diabetes is beyond any trace of reasonable doubt. To my thinking, that is a violation of the right to life. People are making claims about products that we know to be false, and it happens because big money is involved.
That is a really simple example.
There are many examples that are many levels more complex.

Responsibility is about reasonable levels of risk.
Assume all the risk you want with your own life, I have no issue with that – but imposing risk on others for personal gain – that I have deep issues with.

Marx did some really good work, and he made some errors. The conceptual tools he had available were very different from those available to us today.

Marx had the reality of his day.
Today our reality is very different.
Today we have the technology to deliver all the goods and service all people reasonably need, with very little human input, the vast majority of the systems being able to be fully automated.

Communism is about taking from everyone.
I am about taking from no one, but giving to everyone.

In respect of freedom:
People need to be willing to first assess the risk to others when whimsy occurs. If the risk is minimal, by all means – whimsy to your heart’s content. And that step does need to be there. That is all I am saying.
All actions impact all things.
There is a test of reasonableness that we all have a responsibility to apply consistently.
And what passes for reasonable may vary substantially with context.
Dancing and bumping into things in a biohazard lab, not such a good idea, in a pub – no problem.
All I meant is, that freedom must contain this aspect of social and ecological responsibility, of risk assessment, if it is to be real. Without that step, it is dangerous.

Take a look at the term “capital” in the Oxford English Dictionary, read the entire entry, and spend a minute or two contemplating the relationships – that is what I did.

[followed by]

Hi Trevor,

I spent a couple of hours reading your http://www.open-empire.org, and following some of the links.

You are quite explicit that you agree with both Peter Joseph and Jaques Fresco.

I am quite explicit that while both have captured aspects of the issue, both have serious errors in their theses.
I did a critique about 5 years ago https://tedhowardnz.wordpress.com/2011/11/10/zeitgeist-jaques-fresco/

I still don’t know what you consider the be the principles of communism.

When I look at:

It starts out 1 — What is Communism?
“Communism is the doctrine of the conditions of the liberation of the proletariat.”
Ok, I can kinda go along with that idea – as part of the general notion of individual liberty, everyone, however they be defined, needs liberty. So in that sense – OK – yes. And such liberty needs to be universal – so needs to include the rest of humanity as well.

Points 2 & 3 define a set of assumptions, that contain many implicit false assumptions. And within the limited models available at the time, they had a certain logical consistency, and a certain correlation to reality, yet to me, now – are clearly false.
The real situation is far more complex than indicated.

Point 4 – How did the proletariat originate? does quite a reasonable job of making a coherent argument from a system of concepts that lack evolution, games theory, complexity theory, maximal computational complexity or quantum mechanics. So as an explanatory framework, fundamentally crippled.
But within its scope it kinda works.

The set of the points 5-10 are seriously crippled by the context within which they are framed.
They are a very poor approximation to what a human being is, or what human freedom is, but do a better job of exposing some of the incentive structures with market based systems than most of his contemporaries.

Point 11 is one of the better framings of the incentive structures present in market based systems, and the structural change in incentive structures present in that age, from that age. And it still suffers greatly from a modern context of the conceptual structures available now to interpret what was happening then. It does contain a statement “and since capital extends only through employing labor,” that is clearly false, but was a close enough approximation at that point in history that the difference wasn’t significant. Same is not true now.

The phrase “the more new labor-saving machines are invented, the greater is the pressure exercised by big industry on wages, which, as we have seen, sink to their minimum and therewith render the condition of the proletariat increasingly unbearable” hasn’t actually worked out that way in practice, and it is a definite pressure present. And automation is going to “force its hand” soon, and it will need to move towards one of the two major attractors present, they both cannot survive the transition, and only one of them is stable long term – but few people can see that landscape.

Point 13 is interesting – it almost gets there.
The first section has been reasonably well validated in the intervening years.
The second section almost gets there.
Yes we have the industrial capacity to supply all needs, but it is the incentives of exchange as a concept that prevent it happening.
I agree with Marx that the state “that every member of society will be in a position to exercise and develop all his powers and faculties in complete freedom” is desirable.
I am also clear that systemic incentives within a market based (exchange based) system work against that outcome.
There is a path forward, that both preserves freedom, and does not require taking anything from anyone, and that is to remove the need for markets and exchange through fully automating and distributing the means of production.

On that issue, of the desirability of that outcome – I agree with Marx.
But I agree with very little of what follows on from that.

Moving on to 14 —
“What will this new social order have to be like?””

and I read
“Above all, it will have to take the control of industry and of all branches of production out of the hands of mutually competing individuals, and instead institute a system in which all these branches of production are operated by society as a whole – that is, for the common account, according to a common plan, and with the participation of all members of society.

It will, in other words, abolish competition and replace it with association.

Moreover, since the management of industry by individuals necessarily implies private property, and since competition is in reality merely the manner and form in which the control of industry by private property owners expresses itself, it follows that private property cannot be separated from competition and the individual management of industry. Private property must, therefore, be abolished and in its place must come the common utilization of all instruments of production and the distribution of all products according to common agreement – in a word, what is called the communal ownership of goods.

In fact, the abolition of private property is, doubtless, the shortest and most significant way to characterize the revolution in the whole social order which has been made necessary by the development of industry – and for this reason it is rightly advanced by communists as their main demand.”

I simply cannot reconcile any of that with the notion of freedom.
Under such a state one is free to do the will of the majority, and nothing else.

That is not freedom.

I could not live there.

I am so far out on the edge of most normal distributions, that I would find little or no freedom in such a context.
I know I am over 4 standard deviations off normal on several major metrics including IQ, visual system spectrum, auditory range, and lung capacity.

Everything following on from 14 is crippled by the earlier problems.

So I really, genuinely, fail to see useful principles in communism.

I see a useful principle in respect for life (but that isn’t restricted to communism, and isn’t practised very well by many of the adherents to communism).
I see a useful principle in freedom, and again, though Marx speaks it, he does not implement it in practice.

So I am seriously and genuinely asking you to explicitly enumerate what you see as valuable principles.

[followed by]

Hi Trevor,

Yes, you did have a couple of caveats.
I guess it depends very much on how you read them.
I read them in the context you provided of “I’ll happily say that I agree almost entirely with almost everything Peter Joseph (TZM) and Jacque Fresco (TVP) each have to say on these subjects ”

I don’t say that.

I align with far more of what you say, than what they say, and the idea of central control embodied in both TZM and TVP and even your version in practice, seems to me a cure worse than the disease.

Kind of interesting that right now, if there is an emergency, emergency services can commandeer any resources they need, for the period that the emergency is declared – which is kind of the inverse of your proposal. They wouldn’t need to take from me, I would be actively out there offering assistance, as part of my commitment to life – universally.

I don’t actually have a problem with a certain level of private property – about half an acre, and anything one can put on it, without any undue influence from others. That isn’t a problem for the planet and it does support a reasonable degree of freedom and diversity.

That’s more than enough for the reasonable needs of most people.

If you want to go beyond the basics, then certainly, a process of community agreement at some level.

But I am not in any way shape or form in favour of central control of the sort proposed by TZM and TVP, and I am very up front about that.
I am all for distributed coordination, and that is a very different thing from central control.

And certainly, people can coordinate and cooperate, and most will, most of the time, if the incentives within the context are supportive of it.

To my mind, freedom needs to be the default state, with restrictions only on an as required basis.
I do not favour inverting that presumption.

Without my tools, my land, my energy and gardens, I have very little chance of survival. Those things are required for survival. Individuals need to be able to take personal control of the essentials of their own survival if they so choose and the expression of their creativity, and the latter leads into really complex territory.

Private property in this sense is a necessary aspect of security, life and liberty, for many of us, particularly those who do not fit well into established patterns (and if we actually empower freedom, that will be an exponentially expanding set).

I like your principles of:
uses the least possible resources;
for the greatest beneficial outcomes, and;
doing the least ecological & social harm.

And empower that individually, which means individual control of a reasonable level of resources to the greatest degree possible.
Individuals need to learn to make such judgments.
Sure some people will make mistakes – they are part of life, part of learning. Accept them, clean up, move on.

If you look at the system we have now, at the operational level, there is a reasonable approximation to those allocation mechanisms.
We can buy things,
We can hire tools,
We can employ people who bring their own tools,
We can employ people who both employ others and hire tools.
The existing system has this recursive flexibility and power to it at one level, yet comes with real systemic incentive issues at other levels.

In my understanding, Marx used the wrong conceptual tools to develop an accurate picture.
They were near enough for the conditions of his day, but not nearly close enough for the conditions of today.
In order to see what makes complex systems work, one has to look at the interplay of incentive structures, at recursively expanding levels.
Cooperation is absolutely required.
Secondary strategies to detect and remove cheating strategies are absolutely required.
Competition can play a role, and it needs to be secondary if security is a desired outcome (and it is for me).

One can make a substantive case that our existing monetary, legal, and political systems are dominated by cheating strategies.
And to be explicitly clear, it is the strategy sets that need to be removed in practice, not the people employing them.

Most market theorists agree that if markets are to work at all, they require near perfect information, yet our legal systems have concepts of privacy, and Intellectual Property, which protect cheating strategies.

And there is a sense in which privacy can also protect diversity in a rule based system, but if one inverts the priorities, and makes life and liberty the highest priorities, and restricts diversity only where it can be demonstrated to be detrimental (which some could argue is how the existing system is supposed to work, but clearly doesn’t for the majority), then markets could be a useful tool. But so long as market values reign over life and liberty, markets are a serious threat.

Most of my interactions with people have little or nothing to do with money. The golf club is about golf, the cycle club about mountain biking, the coastal management group about the sorts of limits on human activity required to sustain local abundance in the marine ecosystem, the water management committee about the sorts of strategies, technologies and trade offs required to get the best balance we can manage between ecological, recreational, biophysical, and economic uses of available water resources (and that is a really complex set of systems, with multiple dimensions of distributions over time and space). And yes – we do live in a society where the influence of money pervades most things, as does the influence of air, and water, and biology, and weather, and ………….

I recall a conversation some years ago with an advertising executive, who was clear that he was not interested in working on any product unless the margin between production cost and sale price was at least a factor of 10, and preferably 100. For Saudi oil that factor is about 200 FOB the port, and 30,000 at the petrol pump.
Most improvements in technology don’t come with such margins, they come with a few percent.
Most financial transactions have a minimum cost, which sets something of a minimum charge for products.
There are a host of other financial factors that heavily favour incumbent systems, and act as brakes on the rate of change for many people, yet for all that, the rate of change in many key aspects of technology is on exponential trends with doubling times less than two years.
So there is this powerful disconnect, between the interests of the system of money, profit and capital, and the interests of people generally.

Marx did not have the conceptual tools to see that, though what he did see was profound in some aspects. It was definitely a move from fixed certainty towards unpredictability and change, though not nearly enough of a move.

About Ted Howard NZ

Seems like I might be a cancer survivor. Thinking about the systemic incentives within the world we find ourselves in, and how we might adjust them to provide an environment that supports everyone (no exceptions) - see www.tedhowardnz.com/money
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4 Responses to A response to a critique of “Why Capitalism Creates Pointless Jobs”

  1. Hi Ted,

    I came across your comment in evonomics and I found your ideas to be very enlightening as a “hobby economist”. I myself am searching for how this transition that you speak of could happen and shift from a scarcity-based world order to one that is abundance-based. I believe that we are already at its brink with the advent of internet, which seems to straddle this line between free information and its commodification at the same time. With the stockpiles of food and other resources, we seem to have reached the point that we can finally evolve beyond the scarcity-based value set that laid down the rules for the entirety of human history.

    Looking at what prevents us from doing so could be the key to this transition. But another side of me tells me that this is impossible in biological systems. While cooperation among organisms exist, it only exists as a response to competition or predation. As such, isn’t it that the abundance that we have now is actually a result of competition? It seems that the laws of the universe rely on inequalities to provide the energy that sustains life. My take on this is that inequality and suffering is the energy cost for happiness and ultimately life. I am not a sadist, but this is what I have come to accept in order for me to keep my own peace of mind amidst all the fear, hate and suffering.

    What is your take on this?


    • Hi Juan

      I understand that many people believe the statement you made “While cooperation among organisms exist, it only exists as a response to competition or predation”, that is not true.

      In a biological context, cooperation can evolve in any context where there is a benefit in doing so.
      In the case of a species like ourselves, with very slow growing children that require years of support and training before they become self supporting, there are many benefits from many different sorts of cooperation.

      Cooperation can evolve where-ever there is sufficient abundance in the environment for a cooperative of that size to exist.

      It seems that for most of our history, most human populations have lived in a sort of stochastic sweet spot, where various sorts of random events have kept populations low enough that it has been beneficial for quite large groups to be cooperative most of the time.

      We are now in a very special sort of context.

      We now find that we can create technology to automate processes at an exponentially expanding rate.
      We can do more with less far faster than our population is growing. There are limits to how long that is possible, and those limits are not in our immediate or near term future, and if we are smart we will never go anywhere near them.

      We can now, actually, technically, deliver universal abundance of all necessities to everyone BUT!

      The But is, our systems have evolved in a context of scarcity.

      Markets are a scarcity based measure of value.

      Markets cannot deliver a positive value to universal abundance.

      Most people do not look at the world in terms of systems and strategies.
      Most people operate from cultural assumptions and patterns and habits at all levels.

      Few people genuinely explore the unexplored, and are prepared to question anything.

      Inequality isn’t the issue. We are all different, inequality is inevitable.
      The issue is insufficiency.
      Insufficiency and suffering are real, and are possible modes of existence, and they are not necessary modes.

      We have the technological capacity to deliver enough to everyone to do whatever they responsibly choose.

      The issue is the culture, the habits of thought, the beliefs we hold that we don’t even know we hold, because they are implicit assumptions in aspects of our culture.

      The sun is big enough to keep on putting out the energy it is for another 4 billion years.
      That is a long time.
      It is a lot of energy.
      It is radical abundance.

      Our knowledge base is growing exponentially.
      Many of the things we accept were beyond even science fiction when our grandparents were children. That is less than a hundred years.
      What we might understand in another 4 billion years is unimaginable now.

      Energy gradients are required to do work, to sustain pattern against the ravages of entropy.

      There is no such metaphor in the development of consciousness.

      Possibility space is unbounded, and uncertain.
      Some areas of it are known to be dangerous, other areas we know to be unknowable.
      That still leaves infinite room for individual choice, and diversity of life choices, life paths, in reasonable security.

      I say we owe everyone the base starting point of secure existence, and individual freedom. If they leave that space, and choose to explore areas of greater risk, that is a personal choice.

      In our society, money and markets are no longer serving the values of life and liberty.

      Technology has rendered markets redundant, but cultural drag hasn’t quite yet allowed individual awareness to catch up with technical reality in most instances.


      • Jessica says:

        This is the most cognizant and beautiful framed lens I have seen described in looking at our human systems. Thank you for this.


  2. Pingback: Capitalism Continued | Ted Howard NZ's Blog

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