Coyote Blog

From TJIC:

"America cannot be great if most of its workers are in the service
sector"¦" Senator Byron Dorgan (D-North Dakota) declares in his book
"Take This Job and Ship It,""¦

This typical reading of historic manufacturing and service jobs stats is ignorant.  My first rule of quoting a statistic, which I admit I sometimes violate, is to make sure you understand how it is calculated.  Nothing could be truer than with manufacturing jobs statistics.

The best way to illustrate this is by example.  Let's takean automobile assembly plant circa 1955.  Typically, a large manufacturing plant would have a staff to do everything the factory needed.  They had people on staff to clean the bathrooms, to paint the walls, and to perform equipment maintenance.  The people who did these jobs were all classified as manufacturing workers, because they worked in a manufacturing plant.  Since 1955, this plant has likely changed the way it staffs these type jobs.  It still cleans the bathrooms, but it has a contract with an outside janitorial firm who comes in each night to do so.  It still paints the walls, but has a contract with a painting contractor to do so.  And it still needs the equipment to be maintained, but probably has contracts with many of the equipment suppliers to do the maintenance.

So, today, there might be the exact same number of people in the factory cleaning bathrooms and maintaining equipment, but now the government classifies them as "service workers" because they work for a service company, rather than manufacturing workers.  Nothing has really changed in the work that people do, but government stats will show a large shift from manufacturing to service employment.

Is this kind of statistical shift really worth complaining about?  By complaining about the shift of jobs from manufacturing to services, you are first and foremost complaining about a chimera that is an artifact of how the statistics are compiled.  So if we were to correct for this, would manufacturing jobs be up or down?  I don't know, but given on the wailing about "shrinkage" of manufacturing in the US, I bet you would not have guessed this:

Considering total goods production (including things like mining and
agriculture in addition to manufacturing), real goods production as a
share of real (inflation-adjusted) Gross Domestic Product (GDP) is
close to its all-time high.

• In the second quarter of 2003, real goods
  production was 39.2 percent of real GDP; the highest annual figure ever
  recorded was 40 percent in 2000. See the Figure.

• By
  contrast, in the "good old days" of the 1940s, 1950s and 1960s, the
  United States actually produced far fewer goods as a share of total
  output, reaching 35.5 percent in the midst of World War II.

So manufacturing is close to an all time high as a percentage of the economy.  There is absolutely no way anyone who looks at this graph can, with a straight face, talk about the "shrinking" of America's manufacturing sector.   If manufacturing employment is somehow down vs. some historical "norm", then that means that manufacturing productivity has gone up faster than service productivity.  So what?  And to the extent there has been a shift, as TJIC writes, who cares?

Yeah, we hates the service sector.

Who needs lawn care, child care, food preparation, legal
services, stockbrokers, professors, blogs, actors, and contract
software engineers ?

Let's get everyone involved in good 19th century atoms-and-mortar activities like raising corn and smelting iron.

Sure, some flakes argue "those are jobs for machines", but we
aim to recapture the glory of our national greatness, when men were
men, women were women, America was strong, and the average life lasted
50 years and ended with pneumonia, a threshing accident, or a crushing
injury.

The same populists who complain today about the shift from manufacturing to services complained a hundred years ago about the shift from agriculture to manufacturing.  And I am sure all of us would much rather be waking up with the sun each day to push a plow.

I am having trouble tracing this map all the way to its source, but I thought it was cool enough to show here (via TJIC and Carls Blog).  The map renames each state with a country that has approximately the same GDP as that state.

Check out Russia / New Jersey.  And is it really saying New Zealand and the District of Columbia have the same GDP?

Update:  If you enjoyed this post, check out our (free) comprehensive
guide to the skeptics arguments concerning man-made global warming.

I am with TJIC when he says that while colonizing space is a cool thing to do, it doesn't justify government coercion.

For a while now, I have been wanting to post on some of my positions that have changed since I was 18, as I have morphed from a secular conservative to a full fledged libertarian anarcho-capitalist.   One such issue is on space.  I used to be a supporter of government space programs (it was hard not to be such, watching moon landings and Tang commercials in my formative years).  My logic was that the government wastes trillions on all kind of stupid stuff, and the space program was kind of interesting.  I supported it as one of the government's least-bad things.

Unfortunately, I have realized that if you add up every person in the United States's list of least-bad government programs you get ... the totality of the US budget.  Each program has a supporter that thinks that program is a kind of cool exception in the morass of government waste.  I have also, by the way, come to the conclusion that the space program is a direction-less mess, and is not really as interesting as I once thought it was.  The planetary probes are still cool (and probably have the most bang for the buck) but the ISS just seems like a UN building in space and the current plans for Moon and Mars missions appear to be NASA full-employment programs rather than realistic missions.

I swear I have had this identical conversation with my relatives that TJIC has with his.  In particular, he gets at the issue of the hidden labor tax:

TJIC: OK, what's the cost of trash separation?

X: Trash separation?

TJIC: Yes, trash separation. You don't "recycle", per
se, your step is just putting in extra labor to separate your garbage
into two piles -

X: It's free.

TJIC: It's free?  Would you say that it takes 30 seconds a day extra to separate trash?

X: No.

Y: More like 60 seconds.

TJIC: OK, 60 seconds per day is 6 hours per year.  At $50 / hour, that's $300 of labor -

X: But that's nonsense, because we weren't going to get paid for that labor anyway.

TJIC: Yes, but you could have done something enjoyable with that time.

I wrote more about this here, where I also linked to a great Bullshit! episode on recycling.

The other day I posted on Second Life, which seems to be trying to do something eerily similar to the virtual world in Snow Crash.  TJIC has more, from an article in the WaPo:

"¦Earlier this month, U.S. Circuit Judge Richard A. Posner visited
Second Life, appearing as a balding, bespectacled cartoon rendering of
himself, and addressed a crowd of other animated characters on a range
of legal issues, including property rights in virtual reality. Posner
stressed that it was in Linden Lab's interest to ensure due process and
other rights.

"They want people to invest in Second Life, and we know
people won't invest if their rights are not reasonably secure," he told
the audience, which included a giant chipmunk and several supermodels. He went on to predict the eventual emergence of an "international law of virtual worlds" similar to international maritime law"¦

It would be tough for me to single out my single least favorite member of my alma mater Princeton's faculty.  However, Peter Singer would certainly be in the running.  TJIC fisks some of Singers recent writing in the NY Times.  I will leave you to read his thoughts, except I wanted to comment on this paragraph of Singer's:

"¦The rich must - or so some of us with less money like to assume -
suffer sleepless nights because of their ruthlessness in squeezing out
competitors, firing workers, shutting down plants or whatever else they
have to do to acquire their wealth"¦

I could probably write a book just from this quote, but let me just focus on two responses:

• It helps prove my long-time observation that politicians, artists, and academics of a socialist bent who frequently criticize business have absolutely no idea what they do day to day or how they make money or create value.  Most have been an artist/academic/politician since the day they left school, and if they have held a real job in the value-creation part of the world, it is seldom as any type of manager or supervisor.  Singer knows no more about wealth creation than I do about sub-atomic particles.  The amazing thing, though, is that the NY Times would never quote me on sub-atomic particles but frequently gives Singer a platform to hold forth about wealth creation.  Economics is a science too, just as much as physics.  As I said in that linked post:

Economics is a science.  Willful ignorance or emotional
rejection of the well-known precepts of this science is at least as bad
as a fundamentalist Christian's willful ignorance of evolution science
(for which the Left so often criticizes their opposition).  In
fact, economic ignorance is much worse, since most people can come to
perfectly valid conclusions about most public policy issues with a
flawed knowledge of the origin of the species but no one can with a
flawed understanding of economics.

• Read the statement, and really think about what he says, remembering that he really believes these exact words.  Forget about the squeezing out competitors part -- presumably we capitalists are just bashing each other so this is likely the least of his arguments (not to mention how many people Singer likely "squeezed out" in the competition for scarce tenure and professor positions at Princeton).  Think about his statement that the way wealth is created is by "firing workers" and "shutting down plants."  So the logical implication is that the corporation who ends up with no workers and not assets will be the richest?  And here all this time I have been stupidly growing my company by trying to hire more good people and add on productive assets. 

Singer is as qualified to write about business practices as I am to write about South East Asian mating rituals.  Each of us is equally experienced and knowlegeable about these topics.  Somehow, though, the NY Times sees fit to publish Singer and my beloved University pays him to teach.  Unbelievable.