Fixing the Economy Part 1--Simply Economics
Over the next couple of weeks, I plan to fix America’s economy. Okay, I’m probably not going to fix it and it will probably take more than a couple of weeks, but at least I want to explain what’s going on, what’s broken, and what it will take to fix it. To start, today we take a journey across the millennia to peek at what has formed our current economic society.
To keep things simple (my apologies to both my history and economics professors), let me break down economies as taking one of three basic forms.
The first is agricultural. This is where each family or community grows and makes everything they need. They need food, so they gather seeds, plant them, harvest the food, and start over again. They need shelter, so they hew stone or cut timber and fashion it into dwellings. They need clothing, so they sew hides or weave fabric.
In an agricultural community, everyone works sunrise to sunset to subsist. Yes, there is some time to have fun. Yet most of the effort of an agricultural community is aimed at just staying alive.
Second is the industrial economy. We replace a lot of the subsistence labor brawn with tractors, mills, and factories. That means less people are needed to grow the food and other agricultural chores. However, the finer agricultural tasks and much of the manufacturing are done by humans. Lots of humans.
This shift makes way for the third type of economy, which weighs heavily on service sector jobs. After all, if you’re busy in the factory all day, you don’t have a lot of spare time. Now people gather news for you (newspapers), gather crops for you (grocers), fix infrastructure for you (carpenters, plumbers, electricians). All of this is to free you up to mass produce items not just for your community, but also to export to others. You, in turn, import items made far away.
While this trade occurred in the agricultural society, it was for “luxury” goods, not usually necessities. Now a greater part of the industrial community’s necessities are coming via imports. After all, why grow it or make it yourself if someone else can do it better, faster, or cheaper?
Eventually society can evolve to a position where humans are no longer needed to directly manufacture goods, so the economy becomes even more oriented around the service sector. While mostly still in the realm of science fiction, you can see more and more of what were human tasks being replaced by machines, computers, and their offspring, robots. Where something is manufactured takes a back seat to how efficiently it can be brought to the marketplace. There is still a need for humans. After all, someone has to dream of, design, and develop the systems and equipment. Others have to troubleshoot and repair, and some jobs just can’t (yet) be efficiently done by anyone other than a craftsman.
Each step in this process requires less people per task and more training per person. Both have ramifications to society. We’ll tackle that next week.