The nutters at NEF: Jobs are a cost you sodding fools!

But surely this is a recipe for disaster, reducing demand even further in economies already critically short of it. Not necessarily, retort Simms and Potts; indeed, it could bring jobs. Homes and commercial buildings, for example, already have to be made much more energy-efficient, a very labour-intensive process, as is recycling. Improving and increasing public transport, making cycle lanes, and urban farming would also create jobs and wealth.

“Embracing a new materialism could have profoundly positive effects,” they insist. There would be “huge growth in services that will boost the number of plumbers, electricians, builders, farmers, carpenters, and engineers as much as upholsterers, seamstresses, sports coaches and storytellers”.

As usual they\’ve got this entirely the wrong way around. They\’re saying that the creation of jobs, the expenditure of more human labour, is a good thing. When, of course, anyone with an IQ greater than a carrot knows that this is nonsense.

Expending more human labour is a cost of a lifestyle, not a benefit of it.

Imagine, as in the Friedman story, we desire to have a ditch. We\’ll not use machines but instead wallahs with shovels. In order to create jobs you see. But why have shovels? Why not create even more jobs by using teaspoons?

Quite, it becomes ridiculous.

And we can go further. Imagine that we have 100 people able to work. We have two possible technology/labour intersections. In one we use 10 people to perform our ditch creating task. In the other 100.

Nef is saying that the second makes us richer. When obviously the opposite is true. For if we only use 10 to produce the ditch then the other 90 can go do something else. Change nappies, tell stories, sup a pint, smile at the little kiddies or hunt for the cure to cancer.

The second option obviously makes us richer by the number of dry babies smiled at. We do not want to increase the amount of human labouir used to perform a task. We want to reduce it.

For jobs are a cost of a scheme, not a benefit, you ignorant, ignorant, sodding fools.

46 comments on “The nutters at NEF: Jobs are a cost you sodding fools!

  1. For some real world input into the “huge growth in services that will boost the number of plumbers, electricians, builders…. carpenters” ” Homes and commercial buildings, for example, already have(ing – stress that having) to be made much more energy-efficient….”

    Some while ago a customer wanted some work done on the loft space. His kids have a ginormous Scalextric layout up there & he wanted a proper stairway rather than a loft ladder, decent flooring, a proper window rather than a tiny roof hatch to admit natural light & ventilation, proper wiring, the activity area walled off from the lower parts of the roof space where the water tanks live. Simple job, yes? Not when you start messing with building regs it isn’t. Because what he was requesting would have turned his loftspace into arguably “habitable accommodation”. So all sorts of regs regarding stairways, fire checking to the rest of the house, (now being defined as 4 storey) insulation, U values of windows, fire escape provisions, ventilation…..kick in. About quadrupled the price. So his kids could race cars for a couple hours a week. As far as he’s concerned, if the lads are chilly up there they can wear a jumper but the regs say not.

    All this non-optional stuff increases jobs if people can afford to pay for it. If they can’t, then nothing at all gets done & it destroys jobs. Part of the reason housing is “unaffordable” is that housing costs so much more to provide thanks to all these regulations.

  2. If unemployment is a social ill, then jobs for people who would otherwise be unemployed are a good thing. The answer to the teaspoon question is that jobs which seem worth doing are much more enjoyable, and presumably beneficial, than obvious make-work.

  3. NEF’s argument is so wrong I don’t know where to start. Thrift is a way of cutting costs, not increasing them – and as Tim correctly points out, labour is a cost. “Making do and mending” cannot possibly increase jobs overall. Yes, it may provide employment for people who can repair things, but that isn’t going to compensate for the loss of jobs in industries where they make things – if it did, thrift wouldn’t save any money, would it?

    Mind you, the jobs lost would mostly be in China and India, and the jobs created would mostly be in the UK. Thrift in developed countries hurts developing countries. But NEF have a “local is good, global is bad” philosophy, so maybe beggaring the neighbours is exactly what they want to do.

  4. When, of course, anyone with an IQ greater than a carrot knows that this is nonsense.

    Unfortunately, you’ll probably find that, if anything, there is a positive correlation between IQ and believing this type of absolute bullshit. I would guess that the majority of university graduates believe it. Which is why most of them are opposed to free markets, because (among other things) the whole way the market works is to reduce unit labour per unit output.

  5. “Unfortunately, you’ll probably find that, if anything, there is a positive correlation between IQ and believing this type of absolute bullshit.”
    And there, IanB lies a mystery that deserves study. Don’t know about you but I repeatedly come across the spawn of our higher education system cleaving to notions even the certifiably sub-normal would reject. Whatever they teach’em at university, it certainly don’t common sense.

  6. Richard

    Well, division of labour along gender lines is consistent with NEF’s apparent belief that the world was a much better place when peasants tilled the fields. “When Adam delved and Eva span, who was then the gentleman”?

  7. Re my comment at 5;
    It’s my personal theory, so few of our so called higher educated have any connection to or experience of anything where the level of effort affects the level of reward. Most of the people they come in contact with derive their income, usually salaried, by the function attached to their job description rather than the measure of their labour. Thus, they see employment as a method of producing an income stream for the individual rather than as a method of adding value to the wider world.

  8. And there, IanB lies a mystery that deserves study.

    Well, you know my answer: every ruling class has a justifying ideology, a shared value system, and you’re lucky (as an ordinary citizen) if that value system is well connected to reality, and reasonably functional. A hundred years ago it was God, King and Country, kinda thing. Now it’s, whatever you want to call it, Progressivism or Americanised Left-Liberalism or Managerialism. Something like that.

    The point of the justifying ideology is it needs to justify the elevated status of the ruling class. Back in the past, it was “breeding” or, earlier than that, “I have a horse and shiny armour and a nice sword, you don’t”. The current one is designed to justify the largest ruling class in history on the basis that they are better equipped to manage society due to superior intellect, education, etc. So they have to believe that everything will benefit from their management, including, particularly, the economy. And that leads to a social contract (which basically came into being with late industrialism) that the masses would be provided with the means of sustenance, via “jobs”, in return for obedience. So, they ultimately cannot do anything but promise “jobs” without breaking the social contract and losing their justification for existence. The actual validity of any assertions they make regarding jobs, or economics in general, are entirely tertiary to the need for a justifying ideology.

    That’s my take on it anyway.

  9. There’s also, I think I’ve said this here before, a general ideological error that I believe traces to Calvinism, in believing that income should be a reward for work rather than for production. That is, the “work ethic” rather than a “production ethic”. I think this is at the root of a number of persistent economic fallacies.

    In early industrialism, in which work and production were strongly coupled (due to a predominant “private” sector, small “public” sector and microscopic “third” sector) this wasn’t such a problem. The more the economy socialised, the greater the disconnect became, since it now became possible to sustain “work” that did not produce indefinitely via taxation.

  10. “Most of the people they come in contact with derive their income, usually salaried, by the function attached to their job description rather than the measure of their labour.”

    This is very true, especially amongst managers. One of my biggest frustrations is the failure of managers to understand that they are paid to make decisions and shoulder responsibility. If they can’t do that, they might as well be sacked and let the producers/workers just organize themselves. Most of them can’t.

  11. BIS @ 8
    ” Thus, they see employment as a method of producing an income stream for the individual rather than as a method of adding value to the wider world.”

    Isn’t that what Tim, Adam Smith etc would encourage? A good test of whether your activities are actually “adding value to the wider world” is whether the wider world is prepared to give you an income in exchange for said activities.

    I don’t come to this blog (or the comments) looking for criticism of the profit motive.

  12. is whether the wider world is prepared to give you an income in exchange for said activities.

    As I said above, in a strongly socialist economy, the two (work, production) become decoupled. So, you can get an income stream wihtout the wider world being prepared to give you anything.

  13. Ian B, yes, also in a society where monopolies are permitted (to Mr W’s credit, he always acknowledges the need for regulation). Also in feudal, rentier societies.

    My point is that is absurd to be outraged that people want money. Leave that for the Guardian.

  14. Luke, we all know everyone wants an income stream. The point Tim is making (AIUI) is that it is flat wrong for people like the NEF to justify spending on the basis of providing income streams.

    Besides all else, if providing incomes is all you care about, welfare is cheaper than makework, since the makework will actually consume more economic output than just giving people money to sit at home.

  15. “A good test of whether your activities are actually “adding value to the wider world” is whether the wider world is prepared to give you an income in exchange for said activities. ”
    Can’t argue with that at all. Except of course there has to be a market operating to assess the value of such activities. And in many fields the market’s totally rigged.
    Take two fields one I know about, the other I suffer from. plumbing & lawyering. To become a competent plumber takes several years & requires the acquisition of a great deal of knowledge. So does lawyering. But what a plumber earns is directly related to what he achieves. If he doesn’t do what he’s employed to do, he doesn’t get paid. End of. Lawyer can be totally useless but as long as he’s managed to stay within the very loose guidelines of required professional competence he can stuff the client with the appropriate fee. Doesn’t even have to have been successful or have done as requested. Disputing whether the fee’s appropriate pits the individual against the closed shop of the lawyering profession, who understandably act primarily in the interests of their profession.

  16. Can someone please explain to me how improving public transport and building cycle lanes would create wealth? NEF seem to be confusing income with wealth – mixing up stocks and flows. Even an A-level economics student could do better.

  17. Can someone please explain to me how improving public transport and building cycle lanes would create wealth?

    So far as I can tell, any transport systems built with public money have a guaranteed magical effect of generating wealth. Hence the almost pathological obsession found among politicians for building fucking railways. It’s like they’ve never grown up past the Hornby stage.

    I would do one of my “Keynesian” things and then Paul B and I could have a spat, but I don’t think it’s even that. They just seem to believe that transport==money. I often wonder if it really is just some kind of remnant of the Railway Mania. It doesn’t seem to have any plausible explanation.

  18. “My point is that is absurd to be outraged that people want money. Leave that for the Guardian.”
    To be totally accurate here, Luke, the arsewipes at NEF already have money. They’re paid by NEF. What they’re advocating is using our money to provide income streams for other people, irrespective if that’s beneficial for the donors or wider society.

  19. “..mixing up stocks and flows. Even an A-level economics student could do better.”
    There’s a curious thing, Frances, even the totally uneducated understanding things like if I fill the food cupboard up or buy a coat means I won’t be able to order a pint at the pub, evaporates steadily during the ‘A’ Level economics syllabus & has disappeared entirely by the end of the university degree course.

  20. BIS

    Maybe that’s why I understand it, then. I never did A-level economics. Or a degree in economics, either. I did do some economics as part of an MBA – but my economics is the kitchen-sink variety, really.

  21. Luke, about 99% of the monopolies there have ever been were not “permitted” by regulation but created by it

  22. Frances @ 2 “but my economics is the kitchen-sink variety, really.”
    Hence something you share with plumbers not economics grads.

  23. Economists are to blame. If the government buys a new train, economists include it in GDP as it is built, then again because Government expenditure is included over again despite it being spent out of taxes and then again for the third time over just because economists call it investment. GDP is stated at more than twice the value of domestic production and most of the extra is government spending and government revenue. That is why politicians love to build railways. Everyone seems to quote GDP and its growth as if it meant something and very few question it’s calculation. Read my book, “The Trouble with Money”.

  24. Read my book, “The Trouble with Money”.

    The trouble with the money for your book is that it is rather a lot and your comment doesn’t actually encourage me that I will get much cdf for my £20.

  25. IanB @ #14: “So, you can get an income stream wihtout the wider world being prepared to give you anything.”

    La Toynbee, for example.

  26. Ian B>

    #19

    I think it’s pretty much axiomatic to economics that improving communications links – of which transport is one aspect – has economic benefits. Whether that is outweighed by the costs is, of course, another matter.

    If you think poor transport links don’t have an economic cost, I suggest you read this:

    http://www.expeditionportal.com/forum/threads/50799-Democratic-Republic-of-Congo-Lubumbashi-to-Kinshasa

    In fact, even if you agree with me, that’s a good read :)

  27. Dave
    I believe IanB was pretty specific about the building of transport systems with public money. The Congo epic is very amusing but does actually prove his point. The State involvement in the Lubumbashi/Kinshasa highway is to provide plenty of officials to rip off users. It’s a slightly more aggressive version of the London Congestion Charge Area. What it’s not doing is to provide economic benefit.

  28. BIS>

    The Congo is unfathomably corrupt, so that hardly applies. No money is actually spent on the roads. Either way, the point is still that the Congolese interior is crippled economically as a result of travel and transportation being next-to impossible.

    Actually, there is one interesting example in that account of precisely what Tim was complaining about in the blog post – money that was actually spent building roads was spent on labourers with spades rather than machinery in order to create more jobs locally, but as a result the roads lasted all of five minutes, and prevented the economic development proper roads would have brought.

  29. IanB
    “They just seem to believe that transport==money. I often wonder if it really is just some kind of remnant of the Railway Mania. It doesn’t seem to have any plausible explanation.”

    In the case of railways although state funding for new technology and lines has always been haphazard to say the least, it has more to do these days with the conviction that rail schemes produce regeneration. This extends to light rail where the supposed regeneration benefits are always talked up when new schemes are proposed, this doesn’t ever apply to buses which are treated with indifference by politicians. If the gain were real surely subsidising bus services and vehicle build would be just as productive. I think this is a left over from industrialisation in general rather than the Railway Mania, a belief that steel rails and large scale infrastructure are manly and inherently productive ( the same applies to motorways and car factories ), buses on the other hand are quite obviously a service industry and therefore ignored.

  30. It would is perfectly feasible to build very good cars with robots.But if you replace workers with such machines,so obviating labour costs ,whence comes the demand to meet the supply? This is Marxism lesson 3: surplus value, after socialising the rents of land and nationalising the banks.Henry Ford found keeping wages low left him
    with a constant churn of workers,leaving and joining.When he upped their wages considerably to keep them ,he found ,quite adventitiously, that they could begin to afford to buy cars.BTW Marx’s way of dealing with the problem of surplus value does n’t work but at least he recognised the deficit in demand.(His ideas about land values and banks are not a million miles from those of some libertarians.)

  31. Peter Whipp

    GDP is income, not wealth – a flow, not a stock. You’ve just made the same mistake as NEF.

  32. DBC Read, Ford upped the wages to keep his staff turnover down, but it didn’t lead to them being able to afford cars. Cars then were very very expensive compared to the average wage. And there was no 2nd hand market to buy cheap ones.

    As to where the demand comes to keep up the robot manufactured cars? From the need to move around the land. But who do people afford the cars. Well they’re doing all the jobs that are possible by not having to have loads of people making cars. Even if there were people making cars, they would be a tiny proportion of the working population. But if you take the argument further and assume a lot of non-human manufacturing how will people afford the products? By doing all the jobs that can’t be automated. Humanity has gone through work phases. Hunter gather to agricultural to manufacturing and now to service.

  33. “Lawyer can be totally useless but as long as he’s managed to stay within the very loose guidelines of required professional competence he can stuff the client with the appropriate fee. Doesn’t even have to have been successful or have done as requested. Disputing whether the fee’s appropriate pits the individual against the closed shop of the lawyering profession, who understandably act primarily in the interests of their profession.”

    You’re right, Mr in Spain, it is a closed shop, and you won’t find me defending it as such, but even in the gerrymandered market in legal services, poor providers generally do not flourish. Good providers often do not, either. And, at the risk of making another partisan pro-lawyer argument, fixing a leaking drain (or whatever) is a pretty objective test of plumbing success, whereas success in litigation or in non-contentious advisory work may not be as immediately obvious to the non-lawyer (yes, I know how that sounds :)). Sorry, but the law and its operations are not as perfectly rational as the laws of physics. This is not to say that there are no bad lawyers, or lawyers who stiff their clients, etc., just that the comparison might be better made with professions other than plumbing.

  34. who actually pays for criminals. A good one earns well in spite of the alleged risks.
    As well he creates work for police , film makers etc.

  35. I forgot to mention that many crims do what the state won’t let the market do – supply public demand -drugs and the like.
    As well they re distribute wealth.
    Often they create a respect for authority – ie their authority.
    So many benefits

  36. Your excellent point taken, M’learned friend. But I chose the plumber/lawyer comparison to reinforce the point I was making up the thread away:
    “so few of our so called higher educated have any connection to or experience of anything where the level of effort affects the level of reward. Most of the people they come in contact with derive their income, usually salaried, by the function attached to their job description rather than the measure of their labour. Thus, they see employment as a method of producing an income stream for the individual rather than as a method of adding value to the wider world.”
    The plumber, be he ever so humble, is assessed by whether he has achieved a defined outcome. As you so well explain, what lawyering actually achieves is much harder to assess, even maybe definable only by other lawyers, so lawyers tend to be viewed by their function, Lawyer.
    Unfortunately, so many of those headed to higher education, particularly those not partaking of the hard sciences, have little contact with plumbers & much more with lawyers. They see things in a qualitative rather than quantitative sense. Hence the notion the creation of the job, the function, is sufficient in itself whilst paying much less attention to what the job’s actually achieving, in a productive way.
    I think this supports what IanB is saying up at #9. We seem to have acquired a hierarchy of “managers of society” who reject any quantitative assessment of their performance whatsoever. So the outgoing DG of the BBC, gifted a years salary after 54 disastrous days in the post, was promoted on his supposed qualities despite, it now seems, being unable to hack his previous role. No doubt he will soon be reappearing in some other lucrative niche. Meanwhile, down in the engine room, if a plumber had contributed to a similar almighty balls up, the queue to sue his arse off & ensure he never worked again would stretch round the block.

  37. @ML Oh dear .Was not aware that Tim had knocked over this fallacy;musta missed it.Which fallacy was it by the way: I have so many of them?e.g. Having been berated,nay savaged,by his minions for daring to mention Land Value Taxation on this site, I only recently discovered a ringing declaration on the site on 26th Dec 2008 “There are a number of us who believe that Land Value Tax should be implemented.(Hey even Polly has been known to mumble about it.)”So there he is, come clean for Boxing Day,down with the land taxers like Polly ,Mark Wadsworth, Martin Wolf ,Sam Brittan ! Tim W can prove a lot more subtle than one might think from first appearances ( I would say in my defence).

  38. BiS, I recall our host some time ago writing that he wanted to see lawyers, whom he called middle class rent-seekers, get their financial comeuppance. For reasons which now escape me.

    Is this all we are, I wondered?

    The reality is, as with plumbers, people tend to come to us when they have a problem, and unlike buying a spangly new flat screen, who wants to pay for that? We’re a sort of cross between accountants, priests, marketing men and surgeons. If it meant a decrease in my work, I’d be happy to see a bonfire of laws but, as with plumbers, there will always be a demand for those holding themselves out as having some expertise in whatever law we do have and, since law is preferable to vendetta or to arbitrary judgment, I can see nothing wrong, and quite a lot right, with that. To be perfectly candid, however, I just like a good court room bunfight, and if I can be paid for it then so much the better, social utility be damned.

    The payment by status that you describe comes of course from the closed shop thingummy, but then it does for plumbers and electricians, and others, too. And status is a funny thing. There are plenty of barristers who earn less or the same as plumbers of about equal experience. Tube drivers quite routinely earn more than many barristers (and I’m talking here mostly about publicly-funded b’s: family law, immigration law, criminal law etc.). In my own area, which is mostly criminal law, the status of barristers within the system has been de facto downgraded, as it was with doctors in the Eastern Bloc and for the same reasons, so that about 97% of us are now the lowest of the low within the system. Yet to the outside world, daylight is yet to penetrate the magic. In London, trainee solicitors in publicly-funded areas of work now earn about the same or slightly more than receptionists. Newly-qualified solicitors are on a par with NHS nurses, if they’re lucky. And to some extent all of this is a good example of how a closed shop can spectacularly backfire on its members.

  39. Sorry if I touched a nerve MR Lud but it was unintentional. I could have picked another pair of professions but the similarity was pointed out by a lawyer pal because of the way, to be a good one requires not just qualifying but a lengthy acquisition of knowledge. It’s my observation that some professions can be assessed quantitatively, so many leaks repaired, so many aircraft designed that fly without crashing, so many businesses that make a profit. And some professions that are assessed qualitatively. What exactly is a good doctor when the profession defines all doctors as good & gets very windy about the criticism of those who manifestly aren’t. Teaching’s the same…you can write your own list.
    Yet what IanB describes as the “managers of society” class draws much of its influence from the latter. There’s a disproportionate amount of lawyers in the HoC & as far as I’m aware not a single plumber. (Curious then, that the legislature seems to generate such an enormous volume of totally unworkable laws. You’d think they’d do better, being experts an’ that.) There’s rarely any metrics to assess whether a particular action is successful or not & the participants actively resist the creation of them. So by & large, you end up with a system run by people defining their own competence to do so. If outcomes don’t match expectations, instead of looking at their own failings, they’re keener on blaming extraneous factors. If the theory doesn’t match the data it must be the wrong data.

  40. If there’s an objective way to measure lawyerly performance, BiS, independent, that is, of customer satisfaction, then I for one am open to hearing about it…

  41. Lawyers are a triviality, Mr Lud
    We need a method of measuring “managers of society” performance & awarding firing squads on the basis of it.
    We should be well out of ammunition before we start worrying about lawyers.

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