Economics is about the production, exchange, and use of goods and services. I focus here on production, though production is influenced by exchange and use. Consumers are the end users of goods and services, and consumers’ wants drive production and exchange, or would do so in a sane world. (I’ll come back to that when I discuss the role of government on the production side.)
The production side of the economy encompasses several types of actor, where some persons may play more than one role in the epic. Some of the actors, as you will see, are responsible for the fact that real (inflation-adjusted) GDP grows at a much lower rate than it would absent their “contributions”. The cumulative effect of the lower rate is what I call America’s long-running mega-depression.
THE ACTORS ON THE PRODUCTION SIDE
Workers
They find or make and deliver the goods and services to consumers. Without them — miners, lumberjacks, farmers, truckers, carpenters, electricians, barbers, waiters, store employees, and so on — the economy (and population) would rapidly shrink to a primitive state of small-holding farms, hunting and gathering, and exchange mainly through barter.
Technologists
They devise methods and devices that enable workers to find, make, and deliver more, different, and better goods and services. This type — from the clever tinkerer to the doctorate in physics — has been indispensable to real economic progress.
Facilitators
Some of these (e.g., wholesalers) are hard to distinguish from workers, and could be classified as such. Others (e.g., trainers, accountants, bankers, and employees of stock-trading firms) perform tasks that enable businesses to launch, function more efficiently, and expand more to satisfy more of consumers’ wants.
On the side — not directly involved in business operations, but essential to them — are security operatives. These are supplemented and complemented by legitimate (if not always effective) arms of government: law-enforcement agencies and defense forces. As security fails, economic activity falters (witness rampant theft, looting, and subsequent store closures).
Bureaucrats
This type is of two kinds: essential and counterproductive. Essential bureaucrats are those persons who perform functions that a sensible business owner would want to have performed even if he weren’t required to do so by statute or regulation. A recruiter who seeks, screens, and recommends some job applicants for hiring is a bureaucrat that a large business might find it advantageous to have. An auditor who looks for waste, fraud, and abuse in the spending of the business’s money is another.
On the counterproductive side we find those bureaucrats whose actions make consumers worse off. This is done by perform functions mandated by governments, the brain-children of HR departments, and out-of-touch overseers who are seeking the approval of their peers for being “enlightened”.
The counterproductive side is guided by myriad government mandates which circumscribe what a business may produce; how it may produce it (even if inefficiently); who it may employ to produce it (even if incompetently); how much it must pay its employees (through the minimum wage and enforced unionization); where and how it may offer its products (e.g., through restrictions on operating hours, interstate transportation, and advertising).
Overseers
The owner-operator of a small business is but a worker (cum technologist and facilitator) who has to pay himself. In somewhat larger businesses, overseers often also serve as workers, technologists, and facilitators. My interest here is with the overseers in larger businesses, each of whom has responsibility for a particular function, or who is charged with the success or failure of the entire business. I omit shareholders— who almost never have an effective voice in the management of a larger business — and boards of directors — who rarely do more than rubber-stamp the CEOs’ wishes, unless a business is doing badly (often for reasons that have nothing to do with dispensable and dispensed-with CEOs).
THE VILLAINS OF THE PIECE: BUREAUCRATS AND OVERSEERS
If you have lived as long as I have lived, you don’t need to cite a bunch of statistics to show that bureaucrats and overseers have overrun the work force, in and out of government.
Part of this is due to the growth of government bureaucracies, which are filled with bureaucrats (of course) and headed by overseers (bureaucrats on steroids) who dream up more and more things that bureaucrats can do to impede the real economy — the one that consists of workers and facilitators. The work of government bureaucrats ineluctably leads to the bureaucratization of private companies.
Not only that, but government actions are driven by politicians (super-overseers), most of whom are in thrall to various identity groups. In the service of those identity groups, governments and the private companies whose fortunes they decide are riddled with incompetent workers and saddled with incompetent subcontractors. (See “Affirmative Action: A Modest Proposal”.)
THE CONSEQUENCES, AND MORE
And you wonder why things cost more than ten times as much as they did in the 1950s? Government itself and the things that it does to the private sector are the driving forces behind inflation.
And when super-duper overseers — the idiots at the top like presidents and governors — do really stupid things like forcing businesses to shut down and workers to “work” at home and pupils to “learn” remotely, things really go downhill: prices up, output and quality down.
That’s merely the frosting on the cake, which consists of shoveling money at corrupt foreign regimes (some of them terroristic) and domestic layabouts, and forcing private companies to hire incompetent workers and facilitators.
At the heart of all this, of course is the central government, which pretty much dictates to other governments and the nation at large. If the central government had to compete for your business with companies that actually produce things, it would disappear in a New York minute. But it won’t disappear. It just keeps growing — gobbling up your tax money and the money “printed” by the Fed to support its shiftless schemes.
And that, in a bowl of nutshells, is why things cost more than ten times as much as they did in the 1950s, why the economy produces far less than it could, and why nothing will be done about those things unless a “man on horseback” rides to the rescue.