Walter Russell Mead has a short critique of this idea.
Yesterday, I posted about a potential revival in American exports, made possible in part by better manufacturing technology. Walter Russell Mead showed how technology could return manufacturing jobs to America, linking to an article from The Economist by Paul Markillie that looks at 3D printers:
Instead of bashing, bending and cutting material the way it always has been, 3D printers build things by depositing material, layer by layer. That is why the process is more properly described as additive manufacturing. An American firm, 3D Systems, used one of its 3D printers to print a hammer for your correspondent, complete with a natty wood-effect handle and a metallised head….
Everything in the factories of the future will be run by smarter software. Digitisation in manufacturing will have a disruptive effect every bit as big as in other industries that have gone digital, such as office equipment, telecoms, photography, music, publishing and films. And the effects will not be confined to large manufacturers; indeed, they will need to watch out because much of what is coming will empower small and medium-sized firms and individual entrepreneurs. Launching novel products will become easier and cheaper. Communities offering 3D printing and other production services that are a bit like Facebook are already forming online—a new phenomenon which might be called social manufacturing.
The article calls this the “third industrial revolution.”
About a year ago, Joel shared a post by Mark Horne that asked “Is there such a thing as Christian economics?” He began provocatively:
Where to start?
Why don’t we start with people?
Are they a good idea or a bad idea? Are they valuable or a drain?
I was looking at the content for the “new” version of Ron Sider’s Rich Christians in an Age of Hunger, and I noticed that, despite a great deal of backtracking about claims as to what will happen, he still refuses to let go of the myth of the population explosion. We are supposed to help other people, and that means making sure that no more come into existence to eat “our” pie. I assume Evangelicals for Social Action (or whatever organization fulfills its functions now) is pretty much against immigration laws (and they should be!). But the most draconian immigration control is the one guarding married couples from having (“too many”) children.
He contrasts this with Psalm 127′s declaration of children as a blessing and Genesis 1′s injunction to “be fruitful and multiply.” Take a look at his whole post for his reasoning.
I recalled Horne’s approach this spring when I read a couple of different things. One was a World Bank or IMF report that I read for a course on Middle Eastern Political Economy (I don’t recall the institution or specific report). The report talked about improvements in the fertility rate, which of course meant that the fertility rate had dropped off. Orwellian language, to say the least.
Secondly, an installment in Walter Russell Mead’s ongoing analysis of the waves buffeting the New Deal/Great Society model reminded me of Horne’s thesis:
One of the realizations that helped me accept the need to move on was the corrosive effect of one of blue model America’s most unattractive features: the emphasis on consumption rather than production as the defining characteristic of the good life. As I reflected on the corrosive consequences of this shift, and also began to see that a post-blue society might reverse this priority, I began to think more positively about what could come next. Frank Fukuyama wrote about the appearance of Nietzsche’s Last Man at the end of history; that Last Man is more or less Homer Simpson come to life, a mostly passive, consumption-focused individual whose life is all episode with no plot. But if the blue model isn’t the end of history, and if we are moving to something new — there is hope. Bart and Lisa just might grow up into a bigger world that would stretch their capacities and make them something more than Homer and Marge.
Under the blue model, Americans increasingly defined themselves by what they bought rather than what they did, and this shift of emphasis proved deeply damaging over time. The transformation to a new and higher kind of political economy will require us to put production and accomplishment back at the center of our value system. Both on the left and on the right this is something that should be welcome to a lot of thoughtful people.
Mead believes that the changes roiling the nation’s political economy could help to de-compartmentalize the worlds of family, work, and education that used to be much more mixed together before the 20th century. I’d recommend the whole thing, but here’s an important point from his analysis:
You were also increasingly a consumer rather than a producer of government. In the 19th century, American communities were small and generally self-managed. Most Americans lived in small towns or in rural areas where government really was something people did for themselves. The “state” scarcely existed; outside port inspectors and postal officials, the federal government was largely invisible. And even at the state level, local communities were much more autonomous than they generally are now. Local mayors and selectmen had very few mandates coming down from on high; people managed their own schools and roads and other elements of their common life by their own lights.
In the 20th century Americans became more politically passive as the state grew. The citizen was less involved in making government and more involved in watching it, commenting on it, and picking candidates who were sold the way other consumer goods are marketed: you voted for which party and candidates you supported, but more and more of the business of government was carried on by permanent civil servants acting under expert guidance. Government did much more to you, and you did less of it yourself.
A re-emergence of the value of production, as described by Mead, would be friendlier to the model of Christian economics described by Horne.
In The American Interest, Tyler Cowen writes that American exports have a bright future for three reasons: better manufacturing technology, including artificial intelligence, that makes cheap labor less necessary; shale oil and natural gas reserves ripe for the fracking; and the growing wealth of the developing world that will enable consumers there to buy our more expensive products.
Cowen also predicts a number of effects that this will have on American society and politics, which are far out of the realm of my competence to evaluate. His optimism about exports seemed pretty well-founded, though.
Walter Russell Mead has been writing a lot about the decline of the New Deal model of governance in the US, and I’ve been linking to some of those posts. In his latest series, “Beyond Blue,” he’s been looking at what could succeed the mid-20th-century cooperation of big government, big business, and big labor. The latest post looks how the service economy might develop in a post-industrial economy. Mead may be too optimistic about it, but it’s an interesting contrast to the usual pessimism on this subject:
Many of the dystopian fears about the future that lead people to cling to blue model ideas — and the belief that mass manufacturing employment is the only conceivable model that can provide good living standards — are rooted in this concern that the economy is all about the hard stuff. There are fears that we will transition from a world of well paid steelworkers in secure lifetime jobs to a world of baristas and waiters without money, without respect, and without any kind of security or dignity.
Again, this is pretty much what people thought when the family farm was on the ropes. Without agriculture as the mainstay, America would become a nation of paupers. The dignity and self-reliance of the farmer would be replaced by the dependent, pauperized masses toiling anonymously on the assembly lines. Wages and living standards would precipitously fall; American democracy was at risk, a choir of worried voices proclaimed, as the country split into a small group of capitalist haves and a large group of wage-slave have-nots.
The factory jobs that are now hailed by the nostalgists as bulwarks of working class independence and self respect were once denounced by the farm nostalgists (and the utopian Marxists) as anonymous, soul killing jobs. Outdoor farm work was healthy and life affirming. Factory work was the opposite. Americans wouldn’t just lose their affluence as the farms failed and they moved to the cities, they would lose their dignity and their humanity in the brutal, depersonalized factory environment.
But Americans found pride and dignity in factory work; the blue collar working class found its self confidence, built institutions, organized political movements and effectively defined and fought for its interests.
Much of the work of the 21st century will be in the field of personal service rather than factory work. And at the moment wages for this kind of work are relatively low, as wages in factories were once relatively low. With the old sectors of the economy shedding jobs, there are lots of people chasing all the jobs that open up.
This will change as the new economy grows, as entrepreneurs build new businesses and industries. Indeed the relative cheapness of labor is one of the factors that will help the new sectors grow – just as the cheapness of labor helped manufacturing grow in the past. But market forces will ultimately drive wages up and they are likely to stay that way despite the competition from overseas. Many personal services cannot easily be performed at a distance: your morning frappuccino can’t be made in Guatemala, at least until teleportation technology is ready for prime time.
Some nostalgists talk about the dignity of factory work versus the world of personal service. But is there anything inherently less human or dignified in making and serving coffee than in performing a repetitive movement on a mass production line? Overall, an economy that is based more heavily on people-to-people services will offer more people more fulfilling and fully rounded roles than the old factory system did.
In any case, the new service economy is not just going to be a world of pool boys and pedicurists. It will be a world in which more students get individualized educational counseling from a growing group of education coaches and guides. There will be people who help us manage our technical and information systems: you may have a neighborhood Geek Squad type outfit that not only fixes computers when they go wrong but helps you manage and run all the information-dependent appliances and operations that make your home and life work. More people will work with fitness, nutrition and whole-person health professionals. Many of the services that the very rich enjoy today will be adapted to the needs and the pocketbooks of the middle and lower middle class tomorrow. You may have a life and work coach or agent who helps you manage your ongoing lifetime of learning and recertification as you learn new skills and move into new kinds of work. Many of the consulting services that large companies now have will be available to much smaller enterprises. Busy married couples with two good incomes already live in a cloud of people who help with everything from child care to lawn care; there will be more and more services targeted at this market, and more and more people will earn good livings working with upper income clients who have plenty of money but little time.
I’ve been following Walter Russell Mead’s series in which he has been writing that the “blue social model” of the New Deal and 20th-century progressivism (Liberalism 4.0) has past its time. He’s now getting into what would replace it. Recently, he wrote about his discontentment with the blue model, which so many left-of-center Americans and Europeans defend as if it were the apex of human development (read the whole thing for a better understanding):
Social critics spent decades, rightly in my view, denouncing our school system from Pre-K through Ph.D. Mediocre, conformity inducing, alienating, time wasting: the school system trains kids to sit still, follow directions, and move with the herd. As the economy becomes more fluid, more entrepreneurial, it is clear that raising one generation after another of aspiring time-serving bureaucrats is not very effective. But isn’t it also a terrible waste of human potential? Building big box schools where the children of factory workers could get the standardized social and intellectual training necessary enable most of them to follow their parents’ footsteps into the big box Ford plant (and giving the lucky few a chance to escape to the universities and professions) was a huge social advance once. I am not so sure that we should be proud of that today. Maybe there’s something more we can teach our kids than the bland pablum of the standard school curriculum; maybe there are ways we can organize learning so that it is more individual, closer to home, better integrated with the world of work — and more rewarding.
Much of today’s production that doesn’t take the form of mind-numbing, repetitive work in factories comes in the shape of mind-numbing, repetitive work in offices. Government, corporate, legal and non-profit bureaucracies suck up inordinate amounts of human time and talent. It is not at all clear that the output is worth it — or to put it another way, we should be able to get equal or better results with less work. Information technology offers increasing opportunities to transfer more and more of the routine scutwork of administration over to machines, setting the office drones free to do more rewarding, more socially useful things.
In his most recent post, he discussed charter schools and believes that they point the way to a social model for the contemporary U.S.:
Charter schools show us that there are ways to reform government without always going to pure for-profit privatization. This is important if we are to build durable majorities for reform; many voters are uncomfortable with ideas like for-profit prisons and schools. While charter schools can operate under a variety of institutional forms, they often occupy a middle ground between government and the private sector. Charter schools do not (necessarily) entail the privatization of public education; in practice they look more like ‘communitization’. Power shifts from functionaries in City Hall to community based educators who organize themselves into small, accountable units to carry out functions once handled by massive bureaucracies. And because parents have the right to choose among many schools competing for their kids, the public ultimately holds the new schools strictly and relentlessly accountable.
This is more than an innovation in education; it points toward ways in which we can restructure government. Communitization, whether on a for-profit or non-profit basis, will be a major element in any approach to health care that seeks to reduce costs while improving services. Systems that give consumers vouchers and allow them to purchase services from a variety of competing vendors are vital to the future of American governance. Charter schools are paving the way.
The advantages of shifting as many government functions as possible from the lifetime civil service to entrepreneurial and/or community based entities goes farther than the potential for cost savings and quality enhancement. It is also about shifting the center of gravity of American culture and society further toward entrepreneurial and creative values and institutions.
Blue model society fails dismally at one of the key responsibilities of a healthy democratic society. Democratic societies must be educational societies; the experience of living in such societies must teach each new generation the virtues, habits and concepts that allow them to make the decisions that preserve democracy over the long haul. To make decisions as citizens, members of a democratic society must learn some hard truths about the way the world works from their personal lives and careers. That is what the leaders and teachers in charter schools do — much more than most of those who work in traditional public schools.
A charter school isn’t just, potentially, a school that offers more bang for the buck because it is more flexibly managed and is closer to the community it seeks to serve. It is also an academy for politics. The teachers and managers of such enterprises will understand how the world works better than tenured bureaucrats. They have taken risks and borne the consequences; they have acquired the habits of mind that make them effective citizens in a 5.0 world. They will be natural community leaders — the skills needed to organize a charter school, motivate its staff, serve its public while balancing its budget are skills our political class could use more of. They will also be better placed to start new businesses.
He connects this with a previous post on the importance of making the transition in a way that middle-class African Americans don’t lose their newly acquired middle-class status, believing that communitization can enable this transition.
As I’ve said before, Mead is asking some important questions about how we organize our society and how we think about politics. I agree with almost of the questions that he’s asking about the blue model. I’m not posting about his solutions because I agree with them all, but because we do seem to be at a transition time in our country’s political economy and I think that it’s good to put these things out there for conversation.
Walter Russell Mead, who blogs at The American Interest, has been writing perceptively about challenges for America in the 21st century, I think. Today’s post on “The Crisis of the American Intellectual” is worth a read.
In it, he links to another of his posts from January 2010 about our society’s shifting political-economic foundation, where he discusses what he calls the “blue model” built on the New Deal and the post-WWII foundation of big government, big business, and big labor:
In the old system, both blue collar and white collar workers hold stable jobs, a professional career civil service administers a growing state, with living standards for all social classes steadily rising while the gaps between the classes remain fairly stable, and with an increasing ‘social dividend’ being paid out in various forms: longer vacations, more and cheaper state-supported education, earlier retirement, shorter work weeks and so on. Graduate from high school and you were pretty much guaranteed lifetime employment in a job that gave you a comfortable lower middle class lifestyle; graduate from college and you would be better paid and equally secure.Life would just go on getting better. From generation to generation we would live a life of incremental improvements — the details of life would keep getting better but the broad outlines of our society would stay the same. The advanced industrial democracies of had in fact reached the ‘end of history’: this is what ‘developed’ human society looked like and there would be no more radical changes because the picture had fully developed.
Mead doesn’t idealize the old system (as many do); he writes that it actually limited competition, customer service, and innovation. But economic shifts beginning in the 1970s brought global competition that challenged the alliance of big government, business, and labor.
Today, he believes, the only remaining entities that can work on the “blue model” or something close to it are the government (“the last true-blue employer in the country”) and companies that depend on “vast and continuing government support” like protectionist measures, tax breaks, and bailouts. But government may not get to keep doing this either. Mead contends that while politicians and government workers tend to believe that contemporary challenges can be met with “blue model” solutions, voters disagree:
First, voters simply will not be taxed to cover the costs of blue government. Voters with insecure job tenure and, at best, defined-contribution rather than defined-benefit pensions will simply not pay higher taxes so that bureaucrats can enjoy lifetime tenure and secure pensions.
Second, voters will not accept the shoddy services that blue government provides. Government is going to have to respond to growing ‘consumer’ demand for more user-friendly, customer-oriented approaches. The arrogant lifetime bureaucrat at the Department of Motor Vehicles is going to have to turn into the Starbucks barista offering service with a smile.
Third, government must reconcile itself to its declining ability to regulate a post-blue economy with regulatory models and instincts rooted in the past.
Mead’s observations here are the best short analysis of what I think is one of the most difficult national trends to grapple with: we aren’t the center of the world economy, and many of our institutions and expectations are built on the idea that we are.