Thursday, February 5, 2009

The right way to come out of a recession (Part III)

The way to come out of a recession is to raise productivity on producing things people need. All other methods that might give us a lift in the short run is secondary.

You might think, why productivity help us? In a time of recession shouldn't we limit productivity?

Think about this way. Long time ago, a watch took a man several month to make, so to wear a watch, you have to pay for several month of labor, and only the richest man can own a watch. Nowadays, with help of automated assembly lines, a man can produce many many watches a day. In return the watch became much cheaper and affordable. Almost everyone own a watch today.

Another example is food. Not too long ago, farm work are backbreaking, and every family has to work hard just to make enough to feed themselves. Now with the help of tools, food are so cheap, most of us are freed to work on other better things (like software engineer, helping making people's life more convenient).

So productivity helps to free us from simple work, so we can move on to higher level of work that are more important, or more fun. It also helps to bring things that used to only be enjoyed by a few to the masses.

An argument I often heard is, if you don't pay the auto works to be able to buy a car, who can afford a car? Right now the problem is not the pay of the workers, it is the factories are forced to retain all workers even though only a portion of them will be enough given the automated manufacture process.

That is why I dislike today's unions. Yes they have done good things in the past, but the things they do today is anti productivity. Resist to automation (because that will lay people off), make non-flexible rules, artificially inflated wages. This is the reason why out sourcing is so prevalent. Instead of using the advantage of knowledge of advanced manufacture abilities to max productivity, factories are forced to compete on cost of labor.

We should never rely on jobs protecting us. All the tools, watches, cars, computers are just tools, they should be automated and carry little cost. Humans as the smartest animal in the world should learn to adapt new environments and challenges, instead of resist productivity, embrace it and the new world productivity could bring us.

No comments: