If you want to get something done, ask a busy person — or, job lock is a good thing for innovation

obama-doctor-needleObamacare is the gift that just keeps giving . . . if you want to prove to Americans that Leftism works only on paper and, even then, only if you lie about the numbers.  We’ve already had proven that you can’t keep your insurance, you can’t keep your doctor, you can’t keep your hospital, and you can’t keep your money.  The past weeks have also revealed that you can’t keep your job.

The Democrats have tried to spin this last point by saying that people will be freed of the drudgery of work and suddenly have time to innovate.  In fact, according to studies of people who were given that time to innovate (start businesses, invent things, etc.), the sudden time freedom made no difference:

More importantly, a thorough review of the available literature done by the RAND Corporation in 2010 concluded “On net, there appears to be little consensus in this literature on the existence or magnitude of the effect of health insurance on business creation.” To be sure, the same RAND report provides a new empirical analysis suggesting “that “entrepreneurship lock” for men is just over 1 percentage point relative to an annual base business creation rate of 3 percent.” But one way or the other, all these various studies represent efforts to infer the number of “entrepreneur-locked” individuals in the U.S.

Far more convincing is evidence of what happens after the introduction of universal or near-universal health coverage. For example, our OECD competitors all have had national health systems for decades.  Yet Edward Prescott, co-winner of the 2004 Nobel Prize in Economics, has observed that “entrepreneurship is much lower in Europe.” If universal health coverage truly had a demonstrable impact on individual willingness to take risks, this disparity seems counterintuitive. Admittedly, there are many other factors such as tax and regulatory policy that might affect these cross-national comparisons. So the most convincing evidence comes from the first empirical study ever to explore the actual impact of the a shift to universal coverage on entrepreneurship. This study of the Massachusetts health reform (“Romneycare” after which Obamacare was purportedly modeled) found the following:

The author finds significant and persistent suppression of new organization formation when controlling for organization size, sector and owner gender, and limited evidence of geographic displacement of firms across the New Hampshire border. While theory suggests mandatory insurance should reduce insurance costs and improve worker productivity, the author finds that the regulation has no significant impact on worker productivity and limited evidence of increases in insurance costs, and estimates the expected cost in terms of lost employment, sales to the local economy and tax revenue to in the majority of cases exceed the benefit.

Judging by my own life, this data doesn’t surprise me at all.  When vistas of free time open before me, I don’t innovate, I become inert.  More significantly, my brain slows down.  While I, as a busy person, can get 10 chores done in a day, as an un-busy person, I’m lucky if I get 2 or 3 chores done.  My flywheel has stopped spinning and I find it difficult to marshal the energy needed to overcome the inertia and get that flywheel spinning again.  It’s entirely true that, if you want to get something done, you should ask a busy person.

Moreover, if you want to build a better mousetrap, you should probably ask a busy person about that too.  It’s the busy person who has an incentive to simplify tasks.  It’s a busy person who engages with the world in a way that sows and fertilizes ideas in his mind.  It’s also a busy person who dreams of leisure and takes affirmative steps to create sufficient wealth to bring that leisure time about.  Enforced leisure lacks all of those incentives.  After all, if enforced leisure went hand in hand with creativity and innovation, Europe’s once-thriving cradle to crave welfare states would have resulted in the most dynamic economies in history, rather than in economic basket cases.

It’s true that there have always been people who, because of their great wealth, were able to indulge their passions in ways that benefit the world.  Reading about these people, though, one senses that they were so driven that, no matter their station in life, they would have affected the world around them.  Florence Nightingale, for example, had a calling that would actually have been easier for her to pursue if she hadn’t come from a fabulously wealthy, upper-class family.  Most inventions, though, come from busy people trying to figure out a better way (Henry Ford, Thomas Edison, John Rockefeller) or from people who were in a line of work that let their brain float freely to another line (Albert Einstein).

This is a sort of random, ill-thought-out post.  I’m confident in my core idea, but I’m not expressing it as well as I ought — probably because of the stultification of being couch-bound for so many days now.  Please chime in to support or oppose my ragged thoughts.

Only Progressives could believe that robots will destroy the economy

ATM

The newest Ivy Tower Leftist explanation for the economy’s disastrous jobless recovery riffs off of Obama’s remark a couple of years ago about the disastrous effect of ATMs.  You remember that, don’t you?

President Obama explained to NBC News that the reason companies aren’t hiring is not because of his policies, it’s because the economy is so automated. … “There are some structural issues with our economy where a lot of businesses have learned to become much more efficient with a lot fewer workers. You see it when you go to a bank and you use an ATM, you don’t go to a bank teller, or you go to the airport and you’re using a kiosk instead of checking in at the gate.”

Robot

It took a little while for Obama’s minions to catch up with his genius, but catch up they have.  First, 60 Minutes ran a segment in which two MIT thinkers earnestly explain that Americans are going to be increasingly jobless as robots take on more and more of the jobs laborers used to do.  (I didn’t despair when I watched this.  Instead, I was absolutely fascinated by the way warehouse robots save human backs and feet.) AP then got in on the act, explaining with equal earnestness that technology is killing jobs and therefore keeping the economy stagnant.  Typically for the Left, these great thinkers are conflating two actually unrelated things:  the first thing is jobs that are replaced by technology; the second thing is a weak economy that stubbornly refuses to grow.

1912 Model T Ford

In times past, the innovation and a stagnant economy were not related.  Yes, the wheelwrights vanished when cars came along, but cars were part of America’s stunning early 20th-century leap into the modern era.  The economy went crazy, not just because the car industry itself created new jobs, but because the ability to travel speedily and with almost no limits on distance created other opportunities.  People could now travel to jobs that would have been unavailable to them before.  Factories previously powered by steam or water (or humans), suddenly had the internal combustion engine.

1920s tractor

Cars also brought about mechanized farm work and agricultural transport.  These not only made it possible for American farmers to feed a growing, mobile, vastly dispersed nation, but they also improved the nation’s overall health.

Keypunching computer data in the 1950s

In our own lifetimes, computers didn’t do away with jobs.  Instead, they changed old jobs and created new ones.  Between 1960 and 2008, computers also helped supercharge the economy, especially when it came to the advent of personal computers and, later, the internet.  It’s absolutely true that people got left by the wayside; that economic bubbles grew and burst; and that start-ups broke down — but overall, these amazing technological advancements created a bigger economic pie, not just at home, but abroad too.

The carpet beater

Another way of thinking about this is to look at changes in the domestic sphere.  Women used to boil water to do their laundry, wring it out by hand, and then hang it on lines.  To clean their carpets, they’d have to roll them up, drag them out, hang them on a line, and beat them.  Every dish needed to be hand washed and, if there was no counter space, hand dried.  Before flush toilets, someone had to empty those chamber pots and before modern plumbing, servants drew baths by hand.

Victorian house servants

In a pre-modern age, these tasks required massive human labor.  It wasn’t that middle class Victorians didn’t do laundry, clean carpets, wash dishes, or carry water.  They did those tasks; or more accurately, a phalanx of servants did those laborious tasks.  Even a young middle-class couple, just starting out, would have a cook and a housemaid.  And then on laundry day, a laundry woman would come in to help out too.

The world economy did not collapse when labor-saving appliances destroyed the necessity for these domestic jobs.  Instead, the same economy that produced labor-saving devices required people to make, deliver, and market these devices.  The economy shifted and opened ever further.  That’s why I’m writing on a computer, rather than sitting in a darkened room dipping a quill pen in ink.

Bankrupt Solyndra

Why is this changing economy different?  Simple:  in other times, when the jobs shifted, the government didn’t put into place policies that deliberately destroyed economic alternatives that would create employment for those whose jobs become obsolete.  In today’s America, though, the avenues for new forms of commerce and employment are closing, thanks to ever-increasing taxes, regulations, hostility to corporations and industry, and an obsessive government focus on a green energy sector that does not have the chops to grow on its own.

In other words, the Left is only able to conflate obsolete jobs and permanent unemployment because it’s looking at a particular moment in time, one in which the remnants of our once-thriving private sector are still introducing labor-saving devices, even as the Progressive government’s heavy hand is simultaneously suppressing that start-ups that would have piggy-backed on this new technology and provided different (and often better) employment opportunities.

Segregated drinking fountain sign

Ultimately, Progressives, despite their forward-looking label and their “Forward” slogans, are relentlessly reactionary and regressive.  They live in a finite economic world, blind to history’s ever-repeating lesson that, when there is individual freedom, the economy always expands.  Still fighting the battles of the 1960s, they believe Jim Crow is America’s default racial setting, that Muslims are picturesque people on Cook’s tours, and that unwed mothers’ only choices are using coat hangers or becoming social outcasts.

Oh!  I almost forgot.  They also think that, when it comes to aging and medicine, Americans die young, after the hoary old doctor with his stethoscope has done what he could.  As to this last delusion about our modern world, Charles Krauthammer, in summarizing Barack Obama’s historically polarizing, blatantly statist inaugural address, says it best:

At its heart was Obama’s pledge to (1) defend unyieldingly the 20th-century welfare state and (2) expand it unrelentingly for the 21st.

The first part of that agenda — clinging zealously to the increasingly obsolete structures of Social Security, Medicare, and Medicaid — is the very definition of reactionary liberalism. Social Security was created when life expectancy was 62. Medicare was created when modern medical technology was in its infancy. Today’s radically different demographics and technology have rendered these programs, as structured, unsustainable. Everyone knows that, unless reformed, they will swallow up the rest of the budget.

(Credit for some of the ideas in this post has to go to a delightful book I’m reading: Lucy Worsley’s If Walls Could Talk: An Intimate History of the Home. It is a charmingly written reminder that the world is not static, and that fighting yesterday’s battles without an eye to today’s knowledge is a fool’s game. The Left is certainly masterful at the fight, but its ultimate aims are hopelessly and dangerously retrograde.)

The problem with patents

We’ve all heard and read about the fact that profiteers are stifling patents.  They buy up patents, not to encourage innovation, but to shake down people who come up with ideas they claim overlap with the patents that they’ve purchased (and that sit, unused, in their faults).  Frugal Dad came up with a charming graphic showing the problem:

patents infographic

Source: http://frugaldad.com