Efficiency – The God Who Failed

What do people normally mean by efficiency? They mean the amount, quality or some other measure of something that is pumped out of a process given the inputs that are expended in the persuit of manufacturing or extracting something. If I can produce 1,000 cars for every 900 you produce given the same machinery and tools, for example, then I’m more efficient than you (no disrespect). Or better yet, if my factory costs less to run, and the overall cost of producing a single car is less lower for me than it is for you, then that’s another example of how I can be judged to be more efficient than you. Capitalist industry pushes, pushes, PUSHES for efficiency, because that’s how more PROFIT can be extracted for any given input of money, machinery, labour or land. So you understand what efficiency means in this context, and also why it’s the God of our economic doctrines. From it, much is meant to flow, like innovation, abundance, and all that neat stuff. But there’s a sense (actually five) in which capitalism is actually very INefficient. The first one has to do with what Marx and Engels called “crises of overproduction”. This is when goods pile up and there is no market to sell them on. A glut means that lots of excess stuff has been produced and hence isn’t generating a profit, which means that production has to be cut back, wages reduced, and jobs cut. Banks stop lending money because no one’s credit worthy. Marx and Engels said something like this: “The workers are in want of the means of subsistence because they have produced too much of the means of subsistence.” In all previous eras, people might have gone without, but at least it was because they couldn’t produce ENOUGH of what they needed. With capitalism, we have the reverse situation. People can actually go without because they’ve produced TOO MUCH of what they need. Note: we often hear a lot about the “scarcity of goods and services”, and how the market is an efficient mechanism for distributing these goods and services to people based upon demand. But I can “demand” until my face turns blue; the point is that without the necessary capital to back up that demand, it don’t mean much. Goods aren’t “scarce” in relation to who actually needs them. And that’s the insanity of this system. If aliens were observing this, they’d think this species had gone completely mad. Those quaint little humans with their economic doctrines about “efficiency”, while millions go without in a sea of abundance. In the 1970s, a study was commissioned by the United Nations which found that the total industrial and agriculture capacity already in place was sufficient to feed 12 Earth populations. 12. And that was the decade of the Ethiopian famine. Forget economic crises; this is a moral emergency. Which is why, whenever someone spouts the cliche that the problem is overpopulation or that resources are “scarce” (ha!), it makes me want to chuck up on their Nikes.