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At one time in my life my wife and I ran a mom and pop manufacturing company - making baking mixes for the health food market. We did a little thought experiement - a what if.

What if we cornered the entire market of Quebec? Well that would probably double our size. Our total employment would go from 2 to 2 1/2 with that 1/2 person needed for demostrations/sales

So if we increased by the same amount again, caputring all of Canada?

Well - we invest in packaging equipment and stop using machines that could be found in any third world country. We also hire another 1/2 of a person in the sales end of things.

So let us assume that we swollow the US - and are now about 5 times bigger still. What does the employment situation look like? We would need to add 2 people to do manufacturing as we would no longer be able to do it ourselves. We might need a thrid person to assist with various warehouse type work. 1 person for a billing/collections department. Sales would also need to grow with perhaps 3 additional people.

To summerise

Current Size - 2 staff
doubling  - 2 1/2 staf
trippling - 3 staff
15 x increase - 10 staff

Look at it this way - with the same efficiency that we originally started with - up to 30 people could be employed.

As far as I can tell, large scale capitalism has nothing to do with creation of jobs - well not quite - it destroys jobs and concentrates wealth. The anarchist critique of Communism - that it is state Capitalism starts to sound reasonable. At some level there is no practical difference between Capitalism and Communism when a multinatinals grow large enough.

I find myself disagreeing with the standard definitions of "what is Capitalism". These definitions talk about efficiency and cost. My impression is effeciency is not directly a part of Capitalism at all, but rather creativity, flexability, and the ability to take risks. What we have is not Capitialism, but the remenents of Capitalism.

Another thing we discovered when manufacturing baking mixes was that sections of the Canadian economy were dead - they were controlled by nationals and multinationals and it was not possible to bring new products to market in them. The main stream food industry seemd to fit the bill. We needed speciality chocolate chips. We were unable to get them in Canada. Eventually we found a company from California in the health food industry - not the main food industry who was able to supply us with the chocolate chips we wanted.

That's not completely true - Kraft was willing to supply us. I don't remember the exact amount but the figure 20 tonnes seems to be in my head. The most we ever used at one time was, I believe, about 1/2 of a tonne.

It's not that multinationals are particularly nasty either. We had some bad experiences with mid sized companies. But Ault Foods (a division of Kraft) was willing to bend over backwards to supply us. We were talking to their sales rep about purchasing a skid of milk powder. That their sales rep had the time to even speak to us was surprising. That they were willing to sell such small quantities was even more so.

No I don't think we need to get poorer. I think that life styles will change. I think that we need more government understanding and control of businesses.


aspiring to genteel poverty

by edwin (eeeeeeee222222rrrrreeeeeaaaaadddddd@@@@yyyyaaaaaaa) on Mon Feb 5th, 2007 at 12:22:44 PM EST
What you say about efficiencies brings to mind something that has been floating around in my head for a while.

Economists and whatnot always talk about efficiencies, market efficiency and whatnot, and at every turn it seems this entails fewer people working.  One conclusion to draw from this is that the survival of people in general depends upon in-efficiency.  The more efficient the system, the more it keeps its money to itself, without distributing it to the various people who, you know, need to live and all.

Economic in-efficiency makes mom and pop stores possible, makes small communities possible, makes retail diversity possible.  In-efficiency gives people jobs.

Considerings it's always the big actors arguing that we need to get more efficient, to introduce market efficiencies and whatnot, is almost reason enough to oppose "efficiency," but thinking about it in these terms makes the whole concept utterly diabolic.

by Zwackus on Tue Feb 6th, 2007 at 07:36:29 PM EST
[ Parent ]
I spend a lot of time deconstructing the Efficiency Meme.

The essential question is "efficient at what?" or, to put it another way, what input is being minimised while output is being maintained or increased, in order for the system to be described as "efficient"?  When capitalists run the world (which is where we are now), labour is regarded as the most troublesome and expensive input (slavery being illegal these days, too bad eh), and thus it is always the one to be minimised (though minimising quality ingredients and replacing them with cheap adulterants is always on the cards).

In the capitalist's ideal world there would be no labour -- labour costs would be Zero.  But of course there would then be no market, except for a handful of other capitalists all selling to each other, like the old joke about the Irish village (possibly a sneering English colonialist joke, now that I reflect on it -- my apologies to our Irish readers if this is the case) so poor that they had to make a living taking in each other's laundry.

Capitalism has never "created" jobs.  It has Enclosed land and other resources so as to force displaced peasants into abject dependence on a money economy (primarily by creating food and housing scarcity), then tried to minimise the amount paid to those ex-peasants and to minimise the number of peons needed to operate the factory.  It has tried in every case to displace the artisan with the machine, to reduce the number of people-hours needed to do things;  in short, to make people worth less and things worth more.

In some cases this has its beneficial aspects;  machines have replaced some of the most dirty and dangerous and skill-less jobs and reduced a certain amount of suffering among indentured and slave labour.  OTOH machine owners have also enslaved machine operators, devalued artefacts that were once made with pride (and the pride of workmanship is an essential experience of human culture and meaning -- destroying it is no minor vandalism), exterminated entire realms of cultural knowledge and skill, and produced an accelerating deskilling, incompetence, and deepening dependence on machine products.  So that now, as most of us have experienced for ourselves, we have sales clerks who cannot do the basic math of making change for customers if the power goes out and the electronic cash register stops working, children (nay, adults as well) who honestly think that milk exists only in cardboard cartons and fish are flat frozen pale things you find in a freezer case, etc.

When we throw away a piece of clothing because it has a small tear or flaw, rather than fixing it, two processes are at work:  its cheapness has devalued it to the point where it's not worth any time or effort to fix it, which is wasteful;  and our disinterest in fixing it means that we never learn the skills for fixing things and hence are dependent on cheapness for any sense of security in our lives.  The cheapness and the devaluation and the deskilling and the dependency are a synergistic system of their own.

If we regarded "efficiency" as "producing the greatest amount of truly useful and necessary stuff with the least input of nonrenewable energy and the most equitable distribution of stuff to where it is needed," the current system is grossly inefficient.  It produces great gluts of useless stuff that concentrates where it is least needed, and impoverishes billions in the process while wasting irreplaceable fossil energy galore.

If we regard "efficiency" as "making most people as happy as possible" then I think we can look around at suicide rates and antidepressant manufacture and consumption and say that industrialism in its "highest" form, in the affluent West, does not seem to be making much headway.

If we regarded "efficiency" as "conducing best to the health of biotic infrastructure and hence the maintenance of human cultures over long time periods, maintaining the maximum robustness of biotic infrastructure against random hazard," then we would be looking at its exact opposite.  We are in the business of creating newer and better hazards and destroying infrastructure.

If we regarded "efficiency" as "proceeding as rapidly as possible towards the exhaustion of all biotic systems and the crash of our civilisation" then we'd probably be doing pretty well :-)  maybe that's really the object of the exercise... one has to wonder sometimes whether humans in the mass, like cells in the individual, are programmed for apoptosis.

Before we decide if a system is "efficient" we have to decide what it is set up to do, what its inputs and outputs are, and which inputs are being minimised to maximise which output.  To a rentier capitalist, a business is "efficient" if its labour costs are suppressed to the minimum and the profit raked off for the rentier's pockets is being increased to the maximum.  This hasn't any necessary relation (other than a probable negative correlation) to cultural or biotic wealth, human happiness, prospects for longterm viability, etc.

The difference between theory and practise in practise ...

by DeAnander (de_at_daclarke_dot_org) on Sun Feb 11th, 2007 at 04:54:34 PM EST
[ Parent ]
In 1870, the average income in the world's richest country was about nine times greater than that in the world's poorest country. By 1990 it was forty-five times greater.

In 2006, the world's 793 billionaires held combined wealth of $2.6 trillion. (If liquidated in 2006), this wealth could have hired the poorest half of the world's workers -- the 1.4 billion workers who earn a few dollars a day -- for almost two years.

Between 1977 and 1996, the weight of the average American cheeseburger grew over 25 percent, and the volume of the average soft drink grew more than 50 percent. About 40 percent of the world's population now lacks sufficient water for basic sanitation and hygiene, and nearly one out of every five people does not have enough to drink.

Between 2000 and the beginning of 2005, China's daily oil imports soared 140 percent. Saudi Arabia, has pumped a total of 46 billion barrels of oil in the past 17 years, without admitting to any decrease in its stated reserve figure of about 260 billion barrels.

Since 1950, industrialized fishing has reduced the total mass of large fish in the world's oceans by 90 percent. The atmosphere's level of carbon dioxide is the highest in 650,000 years.

(foootnote)

The accumulation of (theoretical) wealth and power in an ever-shrinking elite, as a product of the destruction of (actual) resources and systems necessary to sustain life.  That is what finance capitalism with its ruling fantasy of "value creation" is efficient -- murderously, psychopathically efficient -- at.


The difference between theory and practise in practise ...

by DeAnander (de_at_daclarke_dot_org) on Tue Feb 13th, 2007 at 03:34:04 PM EST
[ Parent ]

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