Tuesday, November 24, 2015

A Holiday Toast

My holiday-season “party piece” is a song I call “The New Year’s Toast”. The chorus goes:

So we’ll fill up our glasses and drink once again
To peace on the earth and good will among men.

It was written by Peggy Seeger in 1960, and it’s dated in some ways. One is the non-gender-neutral language. And it offers the hope for “a world without fallout” from nuclear-weapons tests, which we have thankfully achieved.

But one of the main reasons I like it (apart from the conviviality and singability) is that it celebrates working people. There’s a verse each for construction workers, railroad workers, miners, farmers, writers and artists, and so on.

Who does that anymore? These days we celebrate executives, tycoons, innovators, and “entrepreneurs.” Steve Jobs, Bill Gates, Warren Buffett, Donald Trump, Lloyd Blankfein and people like them are our heroes. We’ve bought into the Austrian brand of economics that claims that economic growth comes from “disruptive innovation” rather than hard, persistent work, and that leadership gets the credit for everything that happens in a company.

Traditional economics teaches that economic growth comes from the process of specialization. As the extent of markets increases, the division of labor becomes finer, and workers become more and more specialized.  Technical innovation is part of the story, but happens mostly as greater specialization gives workers the opportunity to focus on narrower and narrower tasks, and develop new routines and new tools for addressing them. Economists pack a lot into the concept of “technology”, including things like the order in which things are done, or the way machines are laid out on the shop floor. Big breakthroughs are important, but they are rare, and don’t account for the bulk of growth. And there is a lot of hard work involved in applying breakthroughs to practical problems. Thomas Edison, a great innovator, said that it is “one percent inspiration, and ninety-nine percent perspiration.”

Leadership is important, but without workers who are intelligent, diligent, responsible, and creative, leadership doesn’t mean much. If everyone works with only their own interests in mind, the business doesn’t work. Workers’ loyalty to the business is essential, but requires the leaders’ partnership with the workers. This was an issue in the discussion of President Obama’s “You didn’t make that” comment, that was so misunderstood. He was referring to the government’s role in providing the economy’s infrastructure, but also to the role of workers in building businesses.

So, sing it with me:
A toast to the casual laboring man,
Who lives where his work is, who works where he can,
To the builders and spidermen and bold engineers,
May your wages keep rising, lads, over the years.


Hillsdale dad said...

Your concern for the "working class" is admirable. Your disdain for Austrian economics is not. Perhaps you should consider the Austrian emphasis on a sound and stable currency: it would benefit the wage earners in our society much more than any envy-based government or Keynesian solution ever could.

As far as Holiday songs, my favorites refer to the Incarnation, not leftist tropes.

Anonymous said...

Always sad to see how ideological Calvin College has become. One would think as an economist you could actually offer an informed critique of other economists. Of course this would require actually wrestling with their work as opposed to spouting sanctimonious, partisan talking points.

Hillsdale friend said...

"A world where goodwill among men is the law,
A world without fallout, a world without war."

Why do these celebrations of "working people" always end up as laments that there is not some ever-greater coercive force ready to make things right? A warrant for a disruption of it's own, only now in the service of a nameless/faceless/blameless "working man" that is no less of a false god than the entrepreneurial idols you denigrate.

The reality is that "Goodwill among men" already is the law. (I have it on good authority that it's one of the top two.) And while it's undoubtedly man's task to work this law out - to "specialize" as it were - our hope (not to mention the best songs) will always be in the "disruptive innovator".

John Tiemstra said...

First, this post represents my opinion, and no one else's. The Calvin economics department has people with a variety of views on public policy issues. I am an adherent of social economics, which developed from Catholic social thought, and I go with the institutionalist variety of it. Some other economics professors at Calvin are of more conventional, neoclassical views. All of us work to integrate our Christian, Protestant, Calvinist faith with our intellectual life as economists.

I have written quite a bit of "informed critique" of neoclassical economics in particular. If you want to read that, pick up my book Stories Economists Tell, published by Wipf and Stock in 2012.

Wanting to see others prosper, particularly working people who have not participated in the economic growth of the last 30 years, has nothing to do with envy. Quite the contrary.

Austrian School economics seems to me to be too closely connected with libertarianism and atheism to be a comfortable position for a Christian. Nevertheless, there are Christians who espouse it. I think they should reconsider.