Economic Sophisms C III: Effort/Result

Nathaniel Smith
Jul 20, 2017 · 4 min read
Photo of image from exhibit at Detroit Historical Museum

What is more important: maximum input or output? As Bastiat has shown in his previous chapters the answer continues to be found in the perspective one views the question from. Certainly, as individuals we prefer to produce the maximum output with minimum effort. I would much rather double my garden produce through the use of technology than through a doubling of my labor. Indeed I do not judge the value of my garden by how long it took me to till the soil, plant the seeds, weed, and water; no, I judge its value by the quantity and quality of the produce.

It would be quite silly to tell me that if I double the time I spend in my garden, but receive the same amount of produce back, that I am better off. Yet, somehow this idea, that it is one’s effort that matters not what is produced, has filtered into our society. I would propose one reason we feel this way is because if we only focus on the product some people would not have to do much in life, and that is just not fair. For example, in American high schools it is possible to pass all your tests and still fail the class due to absences or lack of homework. Now what is the point of school? Is it to gain knowledge or teach discipline? Perhaps it is a bit of both, but in punishing our students for “lack of effort” we are telling them that it doesn’t matter so much that you have learned (or just know) the material; what is important is that you learned that one must sweat in order to produce something of worth.

Granted, there is a lesson to be learned from cranking out math problems, memorizing vocabulary, and writing on a daily basis that does not consist in what is produced, but in the development of the discipline it takes to do something daily. That question is, why should one develop this discipline? Is it so they can simply say they are disciplined, or is it because it enables them to produce a larger quantity and quality of output?

A major negative implication of teaching society that it is your effort that matters is that people feel like they deserve to be paid even when they have produced nothing. This is hourly labor. I worked for 40 hours so I deserve 12x40 dollars. Never mind how many lawns I mowed during that 40 hours or how much someone was willing to pay me to mow the lawns. An entrepreneur thinks, “I can make $40 mowing, trimming, and edging a lawn. It takes me two hours to do that ($20/hour). If I higher two people to do it at $10/hr each, and they can do the job in an hour then I just made $20 for the time it takes me to do paperwork.” Is this why our society is starting to hate wealthy business people, because they find efficient ways to make money that take little physical exertion?

So how does this apply to foreign trade?

If it takes an American a week’s wage to purchase a TV made in Japan compared to two week’s wage to buy one made in America, where should he purchase the TV? Well if our goal is to maximize effort and discipline, definitely in America. However, if the goal is not effort, but the result of that effort, then the TV should be bought from Japan.

Yet, one might say, what about the American labor force that makes televisions? Good question. They will lose their job because they cannot compete on the free market with Japanese manufacturers. Is this unfortunate? Yes, in fact I don’t know that I can find a strong enough word to describe how horrible it is for communities when factories close due to foreign competition. (I live in Lansing, Michigan where I am forced to view the eyesore of the old GM plan on Saginaw. Our city is not the same without that factory.)

The problem is which businesses to we protect? Sugar? Steel? Cars? Lumber? The list is endless. And I can see three clear reasons that the answer to this questions should be no one; the U.S. government should protect no domestic industry from foreign competition.

1. Cronyism. In seeking to protect domestic industries from foreign competition the government will be forced to choose winners and losers in the process as they cannot protect everyone.

2. Poverty. The average American will be forced to pay higher prices for all goods and services because effort has been prized over result. That is, we have valued the opportunity to labor over the opportunity to produce.

3. Freedom. If an American citizen chooses to do business with a Japanese citizen, what right does the government have to declare this act illegal? Does an American citizen have the right to do what she wills with her property, or must she get permission from the government prior to using it?

Let’s wrap this blog up with a thought I had reading the paper this morning. Currently the United States and China are in trade negotiations. As I was reading the article I was struck by the complete silliness of this arrangement. Politicians are debating with each other over whether or not citizens of their respective countries should be allowed to exchange freely with one another. I guess this may not come as a shock to someone who grew up understanding that he was a “subject” of the king/state; it has hit me square in the face. I grew up an American blowing up fireworks every 4th of July because Independence from the Crown meant I now run the state, not the other way around.

So I ask, what does it mean that America is a government “of the people, by the people, and for the people”? Is this even possible?

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Nathaniel Smith

Written by

High School Economics Teacher and Lacrosse Coach

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