Richard Erlich: Choice is one of capitalism’s inefficiencies

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1:29 PM Friday, March 19, 2010

When we teach America’s young about the fall of the Russian Empire, Bolshevik style, we should dwell a bit on one small reason for that fall — and take away more than a bit of a warning.

Picture lines of people in the Eastern Bloc, queued up to buy ... well, buy whatever was available. One reason for the fall of the Eastern Bloc was the large-scale inefficiency of their economies, their inability to provide enough consumer goods. But those queues of hopeful shoppers were worse than just an image for a problem; they added to the problem.

The people who enjoyed standing in line, for as long as they enjoyed standing in line, were not totally wasting their time: It was socializing time and cheap entertainment. For people not into recreational queuing — say, most adults over 26 or so — time in line was pretty much totally nonproductive and pure waste.

The equivalent film clip for ailing American capitalism would require an incredibly boring montage of Americans pretty much by themselves, on their phones, working menus to try to get to a human being in a corporate bureaucracy (for a relevant example, let’s say their insurance companies).

In terms of the U.S. economic system as a whole, it would be far more efficient to return to receptionists and telephone operators directing callers to the appropriate people to deal with. In terms of each corporation, though, it’s cheaper to put in an automated system and have callers very inefficiently work the menus. Even if we submit bills for our labor, such callers aren’t paid.

Most people’s lives have not been improved by the technological progress of phone menus. Nor are our lives much improved by such injuries to the environment as mass mailings and newspapers stuffed with ads and coupons, coupons that will save money only if you don’t count the time spent studying the ads and clipping the coupons.

Indeed, indeed, I prefer to be a capitalist standing in a supermarket puzzling over 15 different varieties of floor cleaner to being a communist lining up for scarce goods; but I’m not convinced there needs to be just those two options. I prefer a choice of health insurance to living in an area where one company can tell you “Buy our policy or do without” — but I definitely don’t want 15 different varieties of unintelligible policies in a game of high-stakes shopping for health.

For those who enjoy shopping for health insurance, wide choice is fine, but I want that 16th option: Fewer medical tests, lower costs and not having to hassle with insurance companies. If that’s (horrors!) SOCIALIZED MEDICINE!! — damnable socialism even if in a program that strongly involves private insurers and HMOs — then here’s a case where I want to be a “socialist”: One with portable, reliable, affordable insurance.

But I want that “socialist” option in large part on capitalist-style grounds — efficiency — and on the libertarian grounds of fending off people who are just too damn free with my time.

I’m willing to bag my own groceries and pump my own gas, but I don’t want to work the phones for anybody. I don’t want to be forced to spend time shopping for insurance that people in other developed countries get with little fuss. And I don’t want to have to join a “club” and get spammed with ads or clip and file and save coupons to get some decent prices on groceries.

The human world will end with a bang or, more likely, a whimper, T.S. Eliot suggested in “The Hollow Men”; the U.S. economy, I suspect, will go down the tubes to the sound of lightly falling junk mail, and an automated voice telling you, every time you call, that the menu options have changed.

Richard D. Erlich is professor emeritus at Miami University in Oxford, and has retired to Ventura County, Calif.

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