"The Arbitrariness of Manufacturing"
Ryan Avent remarked earlier today that “Something about the word ‘manufacturing’ makes people lose their analytical senses.” I tend to agree. I think the first step to showing the fly out of the bottle on a lot questions related to manufacturing is to interrogate the concept and note that it’s not very rigorously defined. For example, I turned around and snapped the following photograph of a blog post manufacturing plant located at 1333 H Street NW where a crew of blog post manufacturers crank posts out at a steady clip:
Similarly, on Sunday I rode my bike up to the Plant Manufacturers’ Market and bought some squash, hot peppers, tomatoes, and onions from a Plant Manufacturer who drives into the city every Sunday morning to sell organically manufactured plants to the yuppies. Last night I grilled the squash and also used my Rotating Blade Sauce Manufacturer to manufacture some salsa out of the peppers, onions, and tomatoes (plus some lime juice, salt, and cilantro). Grilled squash and salsa were into a tortilla in order to manufacture a taco. Then later I was looking at what was on television, and among other things there’s a show called Ace of Cakes about a guy who manufactures bespoke baked goods.
But—ah—those are all services. Oh well.
Now imagine a world in which we can “manufacture” the same quantity of “manufactured goods” that we have now, but it takes less money and less manpower to do it. Well on average, we’ll still all have the same quantity of “manufactured goods” as we have today. But more people will be available to “manufacture” restaurant meals. After all, to take a trend that’s bemoaned about as often as the decline of manufacturing, why do people eat so much fast food? Well, it’s easier than cooking food yourself and it’s cheaper than other prepared foods. But why is it so much cheaper? Well among other things it’s cheaper because manufacturing a Wendy’s Spicy Chicken Sandwich requires less manpower per serving than does manufacturing the roast chicken at Palena. And so like magic jobs manufacturing manufactured goods turn into jobs manufacturing delicious food and—crucially—the total supply of delicious food products increases and therefore is available to more people.
Which isn’t to say that everyone is going to be a cook in the future. The general point is that throughout human history at any given time there’s a class of goods and services that are broadly appealing but in practice only consumed by a minority because they’re expensive. At the same time, there are mass market goods that everyone buys because they’re cheap and useful. But as we get better at making things, more people can shift into the making of expensive luxury items and then those items become non-luxuries. These days everyone “needs” a refrigerator, but I believe my grandmother didn’t have one growing up. The important thing is to not get too caught up in the words “making” and “things.” A farmer makes plants. A cook makes meals. A chef makes recipes. A restaurant investor makes business plans. A marketing specialist makes brand loyalty. A salesman makes sales. A personal trainer makes muscle mass. A maid makes the bed. A musician makes songs. Obviously no one can say exactly which luxury goods will be mass goods in 40 years, and we really can’t say which luxury goods will be dreamed up, but the process shouldn’t be seen as particularly mysterious. Almost everyone is making things, and almost everyone can think of something he would buy if it were cheaper.