Wealth inequality. We could all take massive raises and work way less if we didn't structure the economy specifically to benefit the richest 2k people in the country.
> It has made the cost of shelter astonishingly expensive. That has a knock on effect to all other aspects of life.
Many people in tech have had a moment in life where they either had a windfall or could have saved aggressively for a few years before moving somewhere low cost and working a 15-hour workweek. (Or retiring.) Almost nobody I know who has had this option, self included, took it.
I'd be happy to work a 15 hour week for less pay, but I don't see any companies hiring part time, so the only option is to become a freelancer. But becoming a freelancer requires additional skills (particularly selling yourself) that most of us industry workers haven't developed.
I noticed there wasn't so much as a word about labor substitutability and the tyranny of logistics. Just like the famous example of how nine fertile women can't produce a baby in one month, there are task differences between hiring say one programmer for eight hours or two programmers for four hours. More communication overhead at the very least, let alone other logistical changes. In order for such changes in practice they would need to demonstrate that the change would be better for such a retooling to take place.
All this is before getting into scarcity of labor as a factor for making such changes unviable to undesriable. Even if we had fully automated basics provided for it wouldn't make sense to cut down on the hours for the remainder that are in high demand and limited supply due to reasons like requiring talent and/or other personality qualities (most people don't have it in them to be a surgeon cutting people open even if their skill level is irrelevant), and have a high lead time in "production". We just plain wouldn't have enough qualified top end people to deal with the number of people who need say brain surgery to have brain surgeons working fifteen hour weeks. Even if it was somehow the norm elsewhere in the economy they would be paid/incentivized up to work longer hours than others.
And this is before touching the final issue of "would there be enough productivity produced with a fifteen hour week" to support the resulting society? You have to do the math here, you can't just assume "it's the CEO's fault for being paid so much" when if the math actually says that even if you could do that they would actually get $2.52 more a year.
Unfortunately upon closer examination the projection of fifteen hour work weeks amounted to just wishcasting.
Keynes had a key observation that if people like both consumption and leisure and have to trade them off against one another, that the income effect of getting richer will dominate the substitution effect between consumption and leisure, so people in richer societies will both work less and consume more. The exact number of hours worked is just a function of the elasticity of substitution between consumption and leisure which he incorrectly guessed (not having the methods back then to empirically estimate it).
You could make the case that we're actually working what he'd consider 80 hour weeks since we've been maneuvered into requiring two incomes to support a household instead of one.
because we still have to compete with each other over resources (opportunities, wage, customers, etc)? Working less wouldn't give you an advantage? It's a race to the bottom and you see it everywhere.
We generate 30% excess calories more than what is required to feed the world even after wasting 25 calories to create one beef calorie for the developed world. There is no competition. There are only distribution problems under capitalism.
After that what’s left? Wants. We should be able to work way less to just survive in this world. We shouldn’t need to work 70 hours a week to afford a small apartment.
I don’t quite follow your argument. We don’t generate nearly as many small apartments (especially in places people want to live in) as calories. Solving food scarcity did little to increase the supply of real estate (if anything it resulted in higher prices because people don’t need to spend as much money on food anymore).
I'm not so sure that every industry generates excess to the point where working less doesn't result in loss. I haven't really kept up with the housing conversation either.
edit: I was going to speculate about equilibrium in the housing market, but it looks like there's already a conversation about that
You can afford a small apartment on way less than 70 hours a week of work if you're willing to live in unfashionable places. Try Toledo instead of San Francisco. The people whining about costs are mostly those who feel entitled to live in a particular city with a lot of cultural amenities and nice weather.
Because whenever economic progress (eg offshoring, efficiency improvements, better competition) happens and gets expressed to the market (ie lower prices), the explicit government policy is to consider this as some kind of failure and create enough new money that not only do prices stay the same, but rather actually go up.
This might even be workable if there were a corresponding government policy to gradually redefine full time employment as an ever lower number of hours. But instead we've been steeped in fallacious "free market" ideology that would paint any such thing as government meddling, even as it hypocritically gives a pass to the inflation treadmill itself.
a) As he titled the paper "possibilities" then the "predicted" vocabulary is clickbait; has anyone explored if it's possible to buy a 1930s basket on 15 hours of 2020s labour?
> I would predict that the standard of life in progressive countries
one hundred years hence will be between four and eight times as high as it is.
Note the qualification "in progressive countries"; have we any?
c) I've heard that the ratio between the cost of nails and the price of lettuce is still more or less the same as it was in the 1770s; the big difference is that in the 2020s a "yeoman farmer" doesn't want to buy nails with their market goods, but wants to buy cars and smartphones.
d) Finally, on the parochial basis that my life revolves around informatics, we've vastly exceeded the 4-8 times Keynes actually predicted.
His future is here — it's just not evenly distributed.
> c) I've heard that the ratio between the cost of nails and the price of lettuce is still more or less the same as it was in the 1770s.
This feels like it can’t be correct.
Nails were expensive and difficult to obtain in the American colonies, so that abandoned houses were sometimes deliberately burned down to allow recovery of used nails from the ashes. This became such a problem in Virginia that a law was created to stop people from burning their houses when they moved. [0]
And nails were a significant expense in Thoreau’s cabin in _Walden_, c.a. 1850s
Maybe lettuce was a lot more expensive back then than I realize, though. I assume that produce is close to “free”, since you can grow it yourself.
Prior to the invention of refrigerated train cars, fresh lettuce wasn't available at any price in certain parts of the country outside of harvest season.
What a nice bubble world view. "People don't work less hours because they would gain so much more money if they worked more"
What is actually much closer to the reality of the majority of working people is that they work 15hours a day and STILL they can't earn what they need to live a quality life.
His prediction was wrong because his theory was wrong
Specifically it's wrong because cost of living goes up as productivity rises.
This is counterintuitive because the cost of producing anything goes down, so you'd assume cost of living goes down. Unfortunately all production (and consumption) requires land, and as productivity rises, so does the cost of land. This isn't because the inputs into land get more expensive. It's for no other reason than that landowners are able to charge more because the land is able to produce more.
To point out the obvious: a landowner in a low productivity region does just the same as one in a high productivity region, which is to say nothing at all.
The land would be there available for use even if no one at all owned it.
This cost gets baked into every single input into every single good and service. The reason a meal is so expensive in New York City as compared to Oklahoma City isn't shipping costs. It's the rent of the restaurant and then the higher wages needed to pay everyone in the restaurant due to their elevated rent needs.
Rent rises (and falls, but more slowly) to exactly the level required to keep some portion of people in poverty and near-poverty, no matter how productive the local area is.
> Rent rises (and falls, but more slowly) to exactly the level required to keep some portion of people in poverty and near-poverty, no matter how productive the local area is.
That's an interesting claim. While it does seems there are some kind of structural forces that all but guarantee a certain percentage of people will live in poverty, I'm not certain that changing rent prices is necessarily a significant factor. I tried to find evidence that changes in rent prices "keep[s] some portion of people in poverty and near-poverty."
Can you point to any references that suggest this is the case?
Land values increase, though it is still possible to make a specific plot of land available to more people by building tall buildings on them and installing elevators. The total rent of a small plot can then potentially be divided amongst hundreds or thousands of people.
Wealth inequality. We could all take massive raises and work way less if we didn't structure the economy specifically to benefit the richest 2k people in the country.
Basic human greed is why. It has made the cost of shelter astonishingly expensive. That has a knock on effect to all other aspects of life.
Oh and because a new iDevice comes out every year.
> It has made the cost of shelter astonishingly expensive. That has a knock on effect to all other aspects of life.
Many people in tech have had a moment in life where they either had a windfall or could have saved aggressively for a few years before moving somewhere low cost and working a 15-hour workweek. (Or retiring.) Almost nobody I know who has had this option, self included, took it.
Because they want access to high-quality (including intellectually stimulating) jobs, which are overwhelmingly in high COL areas.
I'd be happy to work a 15 hour week for less pay, but I don't see any companies hiring part time, so the only option is to become a freelancer. But becoming a freelancer requires additional skills (particularly selling yourself) that most of us industry workers haven't developed.
I noticed there wasn't so much as a word about labor substitutability and the tyranny of logistics. Just like the famous example of how nine fertile women can't produce a baby in one month, there are task differences between hiring say one programmer for eight hours or two programmers for four hours. More communication overhead at the very least, let alone other logistical changes. In order for such changes in practice they would need to demonstrate that the change would be better for such a retooling to take place.
All this is before getting into scarcity of labor as a factor for making such changes unviable to undesriable. Even if we had fully automated basics provided for it wouldn't make sense to cut down on the hours for the remainder that are in high demand and limited supply due to reasons like requiring talent and/or other personality qualities (most people don't have it in them to be a surgeon cutting people open even if their skill level is irrelevant), and have a high lead time in "production". We just plain wouldn't have enough qualified top end people to deal with the number of people who need say brain surgery to have brain surgeons working fifteen hour weeks. Even if it was somehow the norm elsewhere in the economy they would be paid/incentivized up to work longer hours than others.
And this is before touching the final issue of "would there be enough productivity produced with a fifteen hour week" to support the resulting society? You have to do the math here, you can't just assume "it's the CEO's fault for being paid so much" when if the math actually says that even if you could do that they would actually get $2.52 more a year.
Unfortunately upon closer examination the projection of fifteen hour work weeks amounted to just wishcasting.
Keynes had a key observation that if people like both consumption and leisure and have to trade them off against one another, that the income effect of getting richer will dominate the substitution effect between consumption and leisure, so people in richer societies will both work less and consume more. The exact number of hours worked is just a function of the elasticity of substitution between consumption and leisure which he incorrectly guessed (not having the methods back then to empirically estimate it).
You could make the case that we're actually working what he'd consider 80 hour weeks since we've been maneuvered into requiring two incomes to support a household instead of one.
because we still have to compete with each other over resources (opportunities, wage, customers, etc)? Working less wouldn't give you an advantage? It's a race to the bottom and you see it everywhere.
Not an economist.
We generate 30% excess calories more than what is required to feed the world even after wasting 25 calories to create one beef calorie for the developed world. There is no competition. There are only distribution problems under capitalism.
After that what’s left? Wants. We should be able to work way less to just survive in this world. We shouldn’t need to work 70 hours a week to afford a small apartment.
I don’t quite follow your argument. We don’t generate nearly as many small apartments (especially in places people want to live in) as calories. Solving food scarcity did little to increase the supply of real estate (if anything it resulted in higher prices because people don’t need to spend as much money on food anymore).
I'm not so sure that every industry generates excess to the point where working less doesn't result in loss. I haven't really kept up with the housing conversation either.
edit: I was going to speculate about equilibrium in the housing market, but it looks like there's already a conversation about that
You can afford a small apartment on way less than 70 hours a week of work if you're willing to live in unfashionable places. Try Toledo instead of San Francisco. The people whining about costs are mostly those who feel entitled to live in a particular city with a lot of cultural amenities and nice weather.
You could work 15 hours a week if you are okay with early 20th-century living standards.
Positional goods
Because whenever economic progress (eg offshoring, efficiency improvements, better competition) happens and gets expressed to the market (ie lower prices), the explicit government policy is to consider this as some kind of failure and create enough new money that not only do prices stay the same, but rather actually go up.
This might even be workable if there were a corresponding government policy to gradually redefine full time employment as an ever lower number of hours. But instead we've been steeped in fallacious "free market" ideology that would paint any such thing as government meddling, even as it hypocritically gives a pass to the inflation treadmill itself.
a) As he titled the paper "possibilities" then the "predicted" vocabulary is clickbait; has anyone explored if it's possible to buy a 1930s basket on 15 hours of 2020s labour?
b) From: https://www.aspeninstitute.org/wp-content/uploads/files/cont...
> I would predict that the standard of life in progressive countries one hundred years hence will be between four and eight times as high as it is.
Note the qualification "in progressive countries"; have we any?
c) I've heard that the ratio between the cost of nails and the price of lettuce is still more or less the same as it was in the 1770s; the big difference is that in the 2020s a "yeoman farmer" doesn't want to buy nails with their market goods, but wants to buy cars and smartphones.
d) Finally, on the parochial basis that my life revolves around informatics, we've vastly exceeded the 4-8 times Keynes actually predicted.
His future is here — it's just not evenly distributed.
Lagniappe: https://www.smbc-comics.com/comics/1729266273-20241018.png
> c) I've heard that the ratio between the cost of nails and the price of lettuce is still more or less the same as it was in the 1770s.
This feels like it can’t be correct.
Nails were expensive and difficult to obtain in the American colonies, so that abandoned houses were sometimes deliberately burned down to allow recovery of used nails from the ashes. This became such a problem in Virginia that a law was created to stop people from burning their houses when they moved. [0]
And nails were a significant expense in Thoreau’s cabin in _Walden_, c.a. 1850s
Maybe lettuce was a lot more expensive back then than I realize, though. I assume that produce is close to “free”, since you can grow it yourself.
[0] https://en.wikipedia.org/wiki/Nail_(fastener)
Prior to the invention of refrigerated train cars, fresh lettuce wasn't available at any price in certain parts of the country outside of harvest season.
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What a nice bubble world view. "People don't work less hours because they would gain so much more money if they worked more"
What is actually much closer to the reality of the majority of working people is that they work 15hours a day and STILL they can't earn what they need to live a quality life.
His prediction was wrong because his theory was wrong
Both points seem pretty detached from reality? The majority of workers obviously are not working 15 hours a day..
Specifically it's wrong because cost of living goes up as productivity rises.
This is counterintuitive because the cost of producing anything goes down, so you'd assume cost of living goes down. Unfortunately all production (and consumption) requires land, and as productivity rises, so does the cost of land. This isn't because the inputs into land get more expensive. It's for no other reason than that landowners are able to charge more because the land is able to produce more.
To point out the obvious: a landowner in a low productivity region does just the same as one in a high productivity region, which is to say nothing at all.
The land would be there available for use even if no one at all owned it.
This cost gets baked into every single input into every single good and service. The reason a meal is so expensive in New York City as compared to Oklahoma City isn't shipping costs. It's the rent of the restaurant and then the higher wages needed to pay everyone in the restaurant due to their elevated rent needs.
Rent rises (and falls, but more slowly) to exactly the level required to keep some portion of people in poverty and near-poverty, no matter how productive the local area is.
> Rent rises (and falls, but more slowly) to exactly the level required to keep some portion of people in poverty and near-poverty, no matter how productive the local area is.
That's an interesting claim. While it does seems there are some kind of structural forces that all but guarantee a certain percentage of people will live in poverty, I'm not certain that changing rent prices is necessarily a significant factor. I tried to find evidence that changes in rent prices "keep[s] some portion of people in poverty and near-poverty."
Can you point to any references that suggest this is the case?
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Land values increase, though it is still possible to make a specific plot of land available to more people by building tall buildings on them and installing elevators. The total rent of a small plot can then potentially be divided amongst hundreds or thousands of people.
1 reply →