The apex predators of pointlessness

February 20, 2013

I remem­ber as an under­gradu­ate won­der­ing why — with so many applic­ants — were train­ee invest­ment bankers so well paid?

The answer of course is that invest­ment bank­ing remu­ner­a­tion had broken free from the petty eco­nom­ic tyranny of “sup­ply and demand” and was not being driv­en down by an over-sup­ply of poten­tial recruits.

As Jonath­an Schle­fer noted, “Mar­kets do not determ­ine income inequal­ity. It is fun­da­ment­ally a social decision.”

Now we have an argu­ment going on between eco­nom­ists about auto­ma­tion and jobs. Keynes’ bio­graph­er, Robert Skidel­sky, presents it here. It is not really an eco­nom­ic argu­ment.

Keynes had got there first any­way:

[T]here is no coun­try and no people, I think, who can look for­ward to the age of leis­ure and of abund­ance without a dread … To judge from the beha­viour and the achieve­ments of the wealthy classes to-day in any quarter of the world, the out­look is very depress­ing! For these are, so to speak, our advance guard-those who are spy­ing out the prom­ised land for the rest of us and pitch­ing their camp there.

Keynes meant, of course, that wealthy people have to keep them­selves occu­pied. They are the apex pred­at­ors of point­less­ness. For every Henry Cav­endish, lav­ish­ing an inher­ited for­tune on sci­entif­ic research and the pur­suit of know­ledge, there were many more of his wealthy con­tem­por­ar­ies spend­ing their time and money breed­ing horses for the track. This is his “advance guard”.

Extreme wealth in the eight­eenth cen­tury was a func­tion of fam­ily, land and inher­it­ance. The social pro­cesses that allowed such accu­mu­la­tions were com­plex, but the found­a­tions of the Cav­endish for­tune were so secure that a Cav­endish remains a bil­lion­aire and Britain’s wealth­i­est landown­er.

The less occupy­ing stay­ing wealthy is, the more leis­ure they have. But prob­lems arise when the social and leg­al under­pin­ning of this wealth is called into ques­tion, as — for example — in the United States where the south’s agri­cul­tur­al eco­nomy was based on slavery.

The suc­cess of the mar­ket in com­bin­ing com­plex­ity and cus­tom to dis­trib­ute rewards by a seem­ingly “invis­ible hand” also dis­trib­utes pen­al­ties to those unable to take advant­age of either. The mit­ig­a­tion for those pen­al­ties has been the wel­fare sys­tem.

But the real­ity of mod­ern labour is that it is a “mean­ing provid­ing” social insti­tu­tion, and that oppor­tun­it­ies to act mean­ing­fully with­in a corporation/institution are what most jobs provide. The prob­lem of unem­ploy­ment becomes not that one can­not sur­vive (hard tough it may be), but that one is deprived of mean­ing­ful par­ti­cip­a­tion in soci­ety.

The prob­lem of jobs becomes: How do we dis­trib­ute mean­ing? And that is not just a social but a psy­cho­lo­gic­al and philo­soph­ic­al chal­lenge for which we seem, as yet, ill-pre­pared.

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