The Division of Labor: Wealth and Ignorance

One of the main characteristics of a capitalist economy is the division of labor. The division of labor allows for greater efficiency in production by compartmentalizing tasks and having individual workers specialize in a single domain. Perhaps the best example that illustrates this was Henry Ford and his revolutionary advances for the automobile industry.

Prior to Ford, cars were primarily produced by skilled workmen. These workmen not only had to have strong mechanical skills, but also extensive knowledge in engineering, physics and material science. In many cases, these craftsmen were capable of building an entire car by themselves. Indeed, car making was an intellectual artform and each piece was a luxury reserved for the rich.

Then Ford came along and began building cars via assembly line. Ford hired large numbers of unskilled workers, many of whom had never even seen a car in their life, and gave each individual a few simple instructions. Suddenly, these workers had become “car makers.”

fordassemblyline

The division of labor allowed these workers to know just enough in order to do their job without ever needing to fully understand the process. Amazingly, not only was this method more efficient than the cars made by the skilled workmen, but it was cheaper and faster too. Thanks to Ford, car prices dropped dramatically and became so commonplace that even the unskilled workers he had hired could afford them.

Whether he recognized it or not, Ford had expanded on the knowledge and progress from the Enlightenment and Industrial revolution from the 17th and 18th centuries. The following excerpt from A Treatise of Human Nature highlights this:

“When every individual person labors a-part, and only for himself, his force is too small to execute any considerable work; his labor being employ’d in supplying all his different necessities, he never attains a perfection in any particular art; and as his force and success are not at all times equal, the least failure in either of these particulars must be attended with inevitable ruin and misery. Society provides a remedy for these three inconveniences. By the conjunction of forces, our power is augmented: By the partition of employments, our ability en creases: And by mutual succor we are less expos’d to fortune and accidents. ’Tis by this additional force, ability, and security, that society becomes advantageous.” – David Hume, A Treatise of Human Nature

150 years before Ford, David Hume recognized the exponential possibilities that human collaboration had for transforming societies. Today, these “conjunction of forces” are represented in the form of large corporations. This rapid advancement in efficiency is one of capitalism’s greatest qualities- creating vast amounts of wealth through expansive production.

Nevertheless, despite the enormous benefits that the division of labor can provide to society, it is not without its faults. Karl Marx most notably criticized the division of labor with his theory of alienation and how humans become a “cog in a system of machines.” Adam Smith also criticized the division of labor for its harmful effects to democracy in The Wealth of Nations:

“In the progress of the division of labour, the employment of the far greater part of those who live by labour, that is, of the great body of the people, comes to be confined to a few very simple operations, frequently to one or two. But the understandings of the greater part of men are necessarily formed by their ordinary employments. The man whose whole life is spent in performing a few simple operations, of which the effects are perhaps always the same, or very nearly the same, has no occasion to exert his understanding or to exercise his invention in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become. The torpor of his mind renders him not only incapable of relishing or bearing a part in any rational conversation, but of conceiving any generous, noble, or tender sentiment, and consequently of forming any just judgment concerning many even of the ordinary duties of private life. Of the great and extensive interests of his country he is altogether incapable of judging, and unless very particular pains have been taken to render him otherwise, he is equally incapable of defending his country in war. The uniformity of his stationary life naturally corrupts the courage of his mind, and makes him regard with abhorrence the irregular, uncertain, and adventurous life of a soldier. It corrupts even the activity of his body, and renders him incapable of exerting his strength with vigour and perseverance in any other employment than that to which he has been bred. His dexterity at his own particular trade seems, in this manner, to be acquired at the expence of his intellectual, social, and martial virtues. But in every improved and civilized society this is the state into which the labouring poor, that is, the great body of the people, must necessarily fall, unless government takes some pains to prevent it.” – Adam Smith, V.1.178

Smith pointed out that the division of labor breeds ignorance because it encourages citizens to a very narrow focus of awareness. Citizen’s need to know how to do their specialized jobs and that’s it. There’s no need in viewing the bigger picture- the inter-connectivity of society, politics and rational discourse. These compartmental underpinnings explain people like Ben Carson: someone who is a brilliant neurosurgeon, but also a young earth creationist with dozens of delusional and irrational beliefs. Or as Bill Maher describes them, “Smart-Stupid people.”

The truth is that democracy only works well with equally informed citizens- and capitalism, by its very nature of making production extremely efficient, undermines this by destroying the intellectual curiosity that democracy requires. In this way, America has been able to both excel and fall behind at the same time. We are a nation of wealth and ignorance.

Smith suggests that “unless government takes some pains to prevent it,” that this is the path we are doomed to follow. The election of Donald Trump would suggest that the government has failed in this regard and will continue to do so in the near future.

I am, however, optimistic. The Internet has made it easier than ever before to learn and explore ideas outside ones expertise. Automation has and will continue to take over jobs that are simplistic and repetitive. We are a nation of wealth and ignorance, but perhaps one day we can become a nation of wealth and reason.

Ethics and Economic Justice

“The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” – Franklin D. Roosevelt

I have been reading David Parfit’s book Reasons and Persons the past couple of months and I must say, it’s been a wild ride. I recommend it to anyone that subscribes to utilitarian ethics and having their world views pushed to the limit. It may seem farfetched to some, but I suspect Parfit will go down as one of the greats in the history of philosophy.

The book covers a variety of loosely related topics, but I want to focus on the type of utilitarianism he concludes from his arguments: Prioritarianism. Prioritarianism holds that the goodness of an outcome is a function of overall well being (Utilitarianism) with extra weight given to worse off individuals. Let’s look at an example to sharpen the distinction between the two.

Imagine a two-person society: its only members are Jim and Pam. Jim has an extremely high level of well-being, is rich, and lives a blissful life. Pam, by contrast, has an extremely low level of well-being, is in extreme poverty, and lives a hellish life.

Now imagine that we have some free resources ($10,000 for example) that we may distribute to the members of this society as we see fit. Under normal utilitarian circumstances, the $10,000 will generate more well-being for Pam than it will for Jim. Thus giving the money to Pam would be the morally correct choice. However, let’s imagine slightly different circumstances.

Jim, for whatever reason, even though he is already filthy rich and very well-off, would gain just as much well-being by receiving the $10,000 as Pam would. Suddenly utilitarians don’t have a preference on who gets the money because both Jim and Pam’s well-being would increase the same. Prioritarianism on the other hand would give the money to Pam, because she is worse off than Jim.

Furthermore, prioritarianism doesn’t act just as a tie breaker for well-being, sometimes it favors priority over a small amount of well-being in order to emphasize compassion. So if Jim were to somehow gain more well-being from the money than Pam, Prioritarianism still wouldn’t necessarily favor him. It is important to note that the amount of well-being traded for priority is arbitrary, but in most cases we can rely on common sense. But why is that?

Well there is a good reason: There are diminishing returns on the value of goods and money. Would Jim be able to tell the difference between having 1 billion dollars and 1.00001 billion dollars? No, he wouldn’t have a clue. In fact there have even been studies, including a prominent one by Princeton University Researchers, that money doesn’t buy happiness after one earns $75000 a year.

It is estimated that it is around this point where money is no longer a primary concern in ones life. People can focus on health, relationships and leisure’s without the stress of paying the bills at the end of the month, which is a real fear for millions of Americans.

If you subscribe to prioritarianism ethics, a certain amount of wealth redistribution becomes fundamental to a healthy and moral society. In a society where Walmart’s Walton family (one of many examples) owns more wealth than the bottom 42 percent of Americans combined, millions of which are living in poverty and struggling to survive, can a rational person really argue that this disparity in wealth is ethical?

Welfare state capitalism may currently be the best economic model, but its inability to redistribute wealth fairly will continue to raise questions on how it can be improved. Economic justice isn’t about equality. It’s about removing the gross excess at the top to help prevent suffering for those at the bottom.