(Video written and produced by Ted Balaker)
President Obama sure likes that Twitter. Over Father’s Day he became the first sitting president to issue his own tweet and this week he fielded questions during the first-ever White House Twitter town hall. In 2009, he hosted the first YouTube town hall, and Obama’s 2008 presidential campaign was famously adept at harnessing the power of social media to spread the “hopeandchange” message and generate campaign contributions. Our Tweeter in Chief may may enjoy using new technology, but when it comes to preaching what he practices the first new media president can sound like a crusty, old Luddite.
Recently, when asked about the sluggish state of the economy Obama suggested that technology is restraining job growth. “There are some structural issues with our economy where a lot of businesses have learned to become much more efficient with a lot fewer workers,” he said. “You see it when you go to a bank and you use an ATM, you don’t go to a bank teller, or you go to the airport and you’re using a kiosk instead of checking in at the gate.”
Yes it’s true that machines can do jobs that bank tellers or airline ticket agents used to do, just as it’s true that the Internet can do many other jobs humans used to do (Think travel agents welcomed Orbitz?). It’s all true, but we should still root for technology to make things more efficient because that process creates far more good stuff than bad.
Think about how much you value the Internet. How much would someone have to pay you to give up the Internet for the rest of your life? Would a million dollars be enough? Twenty million? How about a billion dollars?
“When I ask my students this question, they say you couldn’t pay me enough,” says Professor Michael Cox, director of the O’Neil Center for Global Markets and Freedom at Southern Methodist University’s Cox School of Business.
The free market, says Cox, creates a huge gap between what consumers would be willing to pay for Internet access and how much it actually costs. Such progress is often pooh-poohed by politicians who think the purpose of an economy is to create jobs. But that gets it backwards. We don’t live to work. We work to live.
As Adam Smith, the father of modern economics, observed centuries ago: “Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer.”
We could come up with countless ways to create jobs by, say, outlawing ATMs, electronic ticket kiosks, automated supermarket checkouts, electronic toll collectors, tractors, Orbitz, computers, copiers, and so on. The further we go with this silliness the closer we get to full employment (in the really old days there were always job openings for hunters and gatherers). But that ain’t progress.
About a century ago roughly 40 percent of Americans worked on the farm, but technology–from tractors to new irrigation techniques–has made agriculture vastly more efficient. Today less than 1 percent of us works on the farm. But the fact that we can feed far more people with far fewer workers is progress. Likewise, if food magically appeared in our refrigerators, it would be tough on the remaining agriculture workers, but free food would be one of humanity’s greatest achievements.
Technology allows us to do more with fewer workers, and that efficiency allows the folks who would have been farmers or travel agents to get to work meeting society’s other needs and wants by, for instance, creating software. Today America is home to more than a million software engineers. These and countless other jobs were “created” because the market served the needs and wants of consumers.
Technology may not create as many jobs as we’d like as quickly as we’d like, but as an engine of growth it’s much more effective than a big blast of government spending. And when Obama’s own economists admit that each job the stimulus “created or saved” cost taxpayers $278,000, it’s clear that the White House’s tweeting technocrats are in no position to criticize efficiency.