The Story of Stuff

October 6, 2009

The other day, Bryan Caplan wrote a post claiming “economics is intuitive.” His claim is basically true, in that most economic insights can be explained in a way that is intuitive. The problem is that’s only half of the story. The real problem is not that economics contains abstruse (thanks, GRE!) or hard-to-understand truths. It’s that a lot of what people think matters actually doesn’t matter at all. So we’ll finish explaining why, say, wages are set by supply and demand, and people will respond with “but what about corporate greed?” To which we can’t say anything but “Right. That doesn’t matter at all.”

Let’s talk about the Story of Stuff. I will also point out this extended critique.

The critique is fun, but ultimately the tone is too polemical for my tastes. Yes, she makes a bunch of absurd claims and her use of evidence is more than shaky, but a lot of it comes across as nitpicky. That said, here are what I see as her truly fundamental errors:

1. She doesn’t understand the price system. At all.

This is really the big one, and you encounter it in a lot of places, so it’s worth talking about here. Anyone who says “we’re running out of resources” doesn’t understand that prices convey information. They tell you, all in relative terms, how abundant a resource is, and how difficult it is to obtain. Perhaps reading Hayek’s “The Role of Information in Society” or the articles “Toward a Theory of Property Rights” by Harold Demsetz would help move believers in “sustainability” toward a more appropriate understanding of how resources are appropriately “rationed.”

Many of the statistics she uses in the video are wrong, but quibbling over them is pointless because the more important fact is that they don’t matter. We only retain 1% of what we buy after 6 months? We shouldn’t argue over what the true number is, because even the true number would be meaningless.

2. “Capitalism depends on an endless supply of cheap labor to function.”

No, no, no, a million times no. I’ve heard this from Marxists before, and it just seems to be a bold defiance of the facts of the world. Capitalism, as Demsetz writes, gives people the incentive to use resources efficiently, i.e. in their most valuable uses. If capitalism depended on a supply of low-paid workers, why would high-wage workers ever be employed? The fact is, wages are determined by competition for workers. Both low-wage and high-wage workers are employed under capitalism, but you don’t have high-wage workers working in unskilled jobs on the factory floor, because that would be a waste of their abilities.

3. “Capitalism depends on consumption to sustain itself.”

From this I’d have to conclude that she doesn’t understand the possibility of spontaneous order. An analogy might be someone who believes that automobiles literally rule the Earth. The only thing the Automobiles want to do is go from place to place, and so they recruit an army of humans to drive them around. Thus we must work to buy more gas to feed the Autos. We must eat so that we’ll have the energy to drive them around. Thus the worth of a human is measured in how much he can feed gas to his Auto and drive it around. The story has some vague plausibility to it, and seems to fit with the facts, but it’s also completely insane.

If you rule out the possibility that people enjoy consumption, and because of this enjoyment they choose to buy and consume things, then it’s easy to reverse cause-and-effect in this case. But people consuming twice as much as they did fifty years ago is a good thing. People in Africa learn to be “thrifty” because they are extremely poor. What they want is to consume more, and thus consuming more would be good, if they could manage it.

———————————-

Of course the video is terrible and infuriating from beginning to end, but I feel like the critique adopts too harsh a tone, when we should be trying to identify the errors that are common to many critiques of capitalism and responding to those, rather than getting in a fight about citations and use of statistics.

In case there was any ambiguity, by the way, let me put it plainly: The Story of Stuff is an awful movie.

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3 Responses to “The Story of Stuff”

  1. Rrrobert! Says:

    Man, if you thought the Story of Stuff was frustrating for you, think of how frustrating it must have been for me. Few things are more irritating than listening to someone articulate your values badly.

    The Story of Stuff is about values, not mechanics, but she flubs the mechanics so badly that she makes the values look bad. Sure, if she thought about it, she could talk about how the price system externalizes costs to people who either don’t have appropriate rights or can’t properly avail themselves of their rights, but she lacks the intellectual vocabulary to do that. As a result, she misidentifies the legitimate issues and fails to offer cohesive solutions, which is irksome.


  2. Like if I would watch Glen Beck. At least, that’s the impression I get from hearing about Glen Beck. I don’t actually know what Glen Beck says or does, but I hear he cries a lot.

    • Rrrobert! Says:

      Yes, assuming you don’t share in the smug bed-sharing pleasure some of my other intellectual conservative friends seem to take in him. They seem to take a particular relish in the rise of figures like Glenn Beck or Sarah Palin, I presume out of cognitive dissonance.

      Not to say I don’t suffer from same. But let me tell you how much I dislike Michael Moore, for instance. Fuck that guy.


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