8. PRODUCTIVITY: FORWARD
Foremost among the necrotic rules, laws or concepts which mislead us are errors in the answers to the questions: What is production? Who is a producer? What affects productivity? Usually, a flawed answer to one of these questions is given when the original sense of the word "produce" has been forgotten: to lead or bring forward. If an action does not truly bring us forward (as an individual, a nation or a species), then it is not truly productive. To encourage such activity retards our true progress.
"Productivity" is the term used to describe worker output per hour. Working harder or smarter would seem to increase output or productivity. Thus, if I manufacture or sell twice as many widgets as a co-worker, most people would say that I am twice as productive. But what if widgets are useless? Does doubling their rate of manufacture indicate improved productivity? Is my generating twice as many widgets actually a case of going forward (productive), or is my action reductive? If reductive, I weakened the economic state by draining resources from needed activities. Similarly, productivity declines when carrying coal to Newcastle, or foreign cars to Detroit.
Referencing productivity solely to hourly output is akin to defining a word by using the same word. Qualifying productiveness requires consideration of a larger context than the mere rate of activity compared to itself. In essence, a question begs asking: "Of course we're busy, but what are we busy at?"
Merely doubling one's busyness rate is not necessarily going forward. Politicians vote to increase public works programs to fight economic stagnation. This does not create productive wealth. Merely increasing the activity rate is not higher productivity if the activity itself does not lead to a better state. Doubling social maintenance programs does not lead forward to a better society.
Economists define productivity as "a measure of how many goods and services are produced in one hour of paid work." Dollars are the measurement of national productivity. Productivity is not directly measured using time. Economists compare productivity of goods and services in dollars. For instance, consider a farmer who derives $7 per hour from cultivating grain and a doctor who charges $100 per hour for his time. Under the prevailing measurement of productivity the doctor is more productive than the farmer.
Using dollars per hour is a flawed measurement of productivity. Does the higher hourly income of armed thieves and drug dealers signify high productivity? In other words, of course we're busy, but what are we busy at?
While few economic policy-makers would advocate improved productivity by encouraging theft and narcotics, some of their advice has had the same effect. The promised improvements in productivity of supply-side economics did not come about because of faulty concepts about productivity and its measurement. Supply-side economics concentrated too much on generating more dollars in a few services. The income of a few individuals (tax-exempted) and a few industries (finance) increased. However, manufacturing and employment regressed. When productivity in the symbols of wealth alone increases then the production of the substance of wealth suffers.
Time and Productivity
Time is the clutter cutter when it comes to what is and is not productive. To survive, we must create goods and services. They are our reserves of time. Quite simply, if the action does not increase your time, then it is wasting your time. Assessing new wealth only in the symbols of wealth can be self-destructive. Hypothetically, considered the stranded sailor who collects pearls instead of seafood for his survival. If you measure your wealth in dollars you are not measuring your wealth with an important question: "Do I use my time to create more time for me in the future?"
Similarly, there is no guarantee when the government guarantees one's savings. Only productive policies affecting the manufacture of basic goods and services can guarantee one's savings. How safe are your stores of wealth when the guarantee is only in money, not goods and services?
Understanding time is the basis of qualifying productivity. Man is a "temporal process." His future existence depends on converting his current time into goods or services that will extend his life. Consider a prisoner who has an hourglass which must never run out of sand. An empty glass is a death sentence. The hourglass drains into a sandbox from which the prisoner scoops sand for redeposit. Armed with a spoon, the prisoner tries to replace the sand more quickly than it drains. In actual life, man depends on shoveling calories into his biological hourglass.
Both sand and calories are quantified in cost and loss. The prisoner's problem is keeping enough sand in reserve. The difference between the time loss and time cost is whether he is profiting with his time or losing. Without working any more, the prisoner can determine his survival time by dividing the reserves by the loss rate. Opposite to the consumption of time is the creation of time, e.g., replacing the draining sand. Each grain of sand is a unit of time. If a spoon of sand drains in 10 minutes then it symbolizes 10 minutes of life.
By comparing the rate of consumption to creation one can see the gain or loss of time, the productivity or reductivity. If the prisoner does nothing or if he deposits insufficient sand, he is reducing his time reserves, drifting toward death. If he scoops more than one spoon of sand every ten minutes, his reserves increase. His time goes forward. He is producing.
Using this model, a very direct measurement of productivity--unlike reliance on dollars per hour--is possible. It takes one minute to scoop a spoon of sand into the reserves. A spoonful of sand drains in ten minutes. The prisoner's productivity is 10. He took his existence forward by 10 minutes for each minute spent in scooping sand.
A similar situation exists for man. Direct measurements of productivity do not rely on unstable symbols of time. For instance, if a farmer can produce enough food to feed 33 people for a year, his productivity would be 33.
A temporal process, thus, must create time to survive.* Its time reserves are constantly draining. Activity that increases time reserves is production. Actions that lose time are reduction. This timistic model depends on human time reserves unlike some models of productivity which compare activity to itself. By some economic schemes, a murderer who doubles his rate of homicide is twice as productive.
This model applies to human survival. The body constantly consumes calories (grains of time) which need replacement if the body is to survive. At any point, the body has a given amount of caloric reserves that represent a survival time. If a person does not ingest additional calories, his internal reserves dissipate. He will die. He will run out of time.
For economic progress, productivity requires human time units. Otherwise, gains in the rate of some activities will hide backward leaps. A better mousetrap is not productive if farmers cease cultivating crops in order to build it. The original productivity goal vanishes in the competition to perfect it: more grain disappears from noncultivation than from hungry mice. Similarly, if a nationwide computer system for commodities and stocks results in farmers concentrating on speculation for income, then less cultivation will result. The computer system will not have taken the human system forward.
Essential Rule of Thumb
Some activities are more essential than others to human survival. Essentialness to life is found in the answer to a simple question: "What if everyone did it?" If people would die, it is not essential. Would you want to live in a world where everyone was a politician? How about a world with only lawyers? How about people wanting to be farmers? If we became farmers we would survive. We might have to give up political poltroonery and frequent litigation, but we would survive.
An economic model that emphasizes productivity per workhour instead of per lifehour reduces our time reserves. The sand-scooping prisoner can show the difference. He first tried working as fast as he could. After a short burst of increased sand depositing, the exhausted prisoner stopped. Morosely, he realized that his jack rabbit scooping had actually resulted in fewer temporal reserves. He was fast, but he couldn't last. His increased productivity per workhour had translated into reduced productivity per lifehour. He wisely realized that a steady but sure rate was best.
Wanting to work smarter, the prisoner sought to maximize his productivity. He had been alternatingly using each hand to scoop. It dawned on him that one hand was more efficient than the other. Quickly, wanting to raise the efficiency per arm, he cut off the less efficient arm. After a few hours the once highly efficient arm wearied and fell below a rate needed to keep the prisoner alive.
Measuring productivity in lifehours, not workhours, provides a means by which to assess whether a person is productive overall in his life. Does the combination of work and leisure time result in a forward state of being? In fewer problems for himself and others? Which father would you rather have:
a lawyer who earns $100 an hour but drinks and gambles it away after work, or
Of the two fathers, which is productive in the sense of creating more time for himself and his world? As social creatures, the former has a greater potential to increase the value of time for humanity. However, as human beings, the sum of their total actions determines the relative human value. On the balance, given the preponderance of lawyers in the law-making process and the decline of civilizations, street sweepers have done more for mankind in recent times.
Many people have lifestyles with little productivity per lifehour despite high productivity per workhour. If one becomes burned out due to overwork, one would be better off working less. The slow but sure livelihood of a tortoise comes to mind.
A wise worker adjusts his productivity per workhour to maximize his lifehour production during his worklife. Working twenty-four hours a day would kill you quickly. Monopolizing the available work would create unemployment and violence that could kill you. Cutting corners today may obligate you to spend the rest of your life correcting the error. The chemical industry initially saved money by burying chemicals, e.g., in Love Canals. The final correct disposal cost was much greater. Similarly, many parents short-cut their responsibilities to themselves, their children and their world by not taking the time to say "No." The later correction time cost in teaching "no" is greater. Young people learn "no" better than old people. The cost of never learning "no" is even greater.
Active Workers vs. All Workers
Increasing the statistical measurements of worker productivity is easier than increasing the actual productivity of a worker. For instance, if a company has 100 workers, it could increase its productivity per worker overnight by firing everyone except the best worker. The next morning the measurement per worker would have increased.
In Washington, the politicians pass laws which merely increase productivity per active worker. Not a single worker need increase his actual productivity. Consider a prison full of sand scoopers. Supposed the guards offered to help the prisoners increased their sand-scooping productivity by removing the elderly, the women and the children? The politicians use a concentration camp model of raising worker efficiency.
When productivity measurements are in units of time creation, productivity does not increase by firing the less efficient workers. A minimally efficient person working creates more time reserves than he is consuming. Eliminating workers to improve statistics reduces the forward motion (productivity) of an economy.
The counterproductive effects of measurements per worker would not occur if the measurements were what they imply to be, that is, measurements of all workers. Very obviously, productivity measurements would not increase as a result of firing employees if the statisticians measured both active and inactive workers. If productivity statistics are to be accurate, they should include hours with zero output for each unemployed worker. Then one could see the true effects of political action on productivity.
For instance, suppose a factory with 100 workers had an average hourly output of 1000 widgets or 10 widgets per worker. Suppose management decided to increase productivity by firing the 50 least efficient workers. After the layoffs, productivity per active worker increased to 12 widgets per hour for a total of only 600 widgets. Yet, productivity for all workers--active and inactive--fell to 6 widgets per hour per worker.
Many mergers purportedly increase efficiency per worker. The opposite is the case. Tragically, politicians have legalized tax benefits for these counter-productive, decapitalistic mergers.
Capita Equals Lifehours*
Productivity per active worker and productivity for all workers are not the same. Neither are as important as per capita productivity. Very obviously, consumption per capita can be no greater than creation per capita. If consumption is greater than creation then the sand is disappearing. The collection of people, whether a family, a nation or a civilization, is not producing enough. Pursuing increased productivity per worker should never come at the expense of productivity per capita, yet politicians do this all the time. Such decapitalistic policies are not capitalism per capita but are capitalism for a fewer few.
Using unemployment to fight inflation lowers productivity. Forced unemployment may scare the remaining workers into higher productivity per dollar or per workhour, but the productivity per capita falls. Most mergers and takeovers lower productivity per capita.
Using productivity per capita as a measurement shows how the underdeveloped countries have necronomically imbalanced their economies. The shift of rural workers to the cities has destroyed agricultural production. Higher prices for scarcer essential goods have negated initial economic gains from cheap exports. The decline of essential products has generated shortage inflation and imports. Countries formerly self-sufficient in essential production have become importers, subject to external factors beyond their control, e.g., Poland, Iran, Nigeria and Mexico (1970s & 1980s).
During the 1980s some countries and communities enjoyed better standards of living. Many others regressed. The main question is how to stop and reverse the slide in the quality of life. Productivity must be measured per capita using a basic unit of time--the lifehour.
Warning: Anyone found stealing lifehours will be forever banned from participation in and rewards of Better Democracy and Capitalism.
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