The X-Factor

In the last post, I placed a value on the work of human hands. The example was the village of chairs in Italy. The question is why we are letting ourselves become the slaves of the machine. Why we are sacrificing the beauty of the unique work of our hands for a mechanical, uniform product of the machine.
Firms are profit maximizers. In order to maximize profits, we must minimize losses. In order to minimize losses, we must minimize costs. What is typically the most costly resource? Labour. Not only is it costly, but it is not perfect. By this it is meant that there is human error where machines can do it right, every-time. So by eliminating the human factor, costs are minimized. Machines can make things faster and usually of the same quality, so why have humans.

This is a failure maybe of the market, but also of economics itself. Both failures lie in their under-allocation of value towards human work. By human it is not meant someone who operates a machine that makes cars, but a carpenter, a tailor, a shoe maker.
Although the firms are not externalizing their costs, they are getting reducing their costs in such a way that it does not benefit society, in any way. The result is more unemployment. Even those who remain employed find their work more tedious, because they have been made slaves of the machine.
Economics has not made matters better. On the contrary, the one-dimension that it provides, the simplicity of defining well-being as measured in terms of profits has cultivated this sort of behaviour. It has fuelled the industrial revolution, and now makes the transition into the technological revolution. Obviously then technology is the way of the future, as it has been the way of the past.
The role of government herein is therefore extremely important. The government is the regulation body, necessary because we have seen that an entirely free market, motivated by greed, results in negative externalities and large divisions of society and financial standing. Our governments must then find a way to shift the focus of technology. Research and development is essential, it is true. But research and development into faster micro-chips, while the world is on the brink of an energy crisis, is not essential. How are you going to use the micro-chip when we have no electricity to even power a calculator?
Government then needs to use its all its tools to encourage society to reconsider its values, and engage in discussion about the direction business is going in.