You wouldn’t think that policymakers need to be reminded that technological progress raises living standards and creates new (and better) employment opportunities. Alas, some comments President Obama made in a speech last week seemed to link technology to job losses. “There are some structural issues with our economy where a lot of businesses have learned to become much more efficient with a lot fewer workers,” he said. “You see it when you go to a bank and you use an ATM, you don’t go to a bank teller, or you go to the airport and you’re using a kiosk instead of checking in at the gate.”

In an essay in today’s Wall Street Journal, one of my Mercatus Center colleagues Russ Roberts, a professor of economics at George Mason University, brilliantly deconstructs this logic and points out why technology doesn’t destroy jobs:

Somehow, new jobs get created to replace the old ones. Despite losing millions of jobs to technology and to trade, even in a recession we have more total jobs than we did when the steel and auto and telephone and food industries had a lot more workers and a lot fewer machines. Why do new jobs get created? When it gets cheaper to make food and clothing, there are more resources and people available to create new products that didn’t exist before. Fifty years ago, the computer industry was tiny. It was able to expand because we no longer had to have so many workers connecting telephone calls. So many job descriptions exist today that didn’t even exist 15 or 20 years ago. That’s only possible when technology makes workers more productive.

Read the whole thing. Great stuff.

Read Part II here

In February, Congress passed the Obama Administration’s “(Five Year) National Broadband Plan,” part of the so-called “Stimulus.” (As economist Russ Roberts put it, government “stimulus” is “like taking a bucket of water from the deep end of a pool and dumping it into the shallow end.”) The Plan transfers $7.2 billion from taxpayers to broadband providers in subsides to promote broadband build-out. More than 10,000 comments have been filed on the plan. Once you get past the constitutional nicety of whether Congress has the power to subsidize “internal improvements” like broadband (it doesn’t), you might wonder just how well your money will be spent by all these techno-supplicants for the latest craze in corporate welfare.

The good news is that these comments are available online. Hurray for transparency! The bad news is that… they’re available online—specifically on the FCC’s Electronic Comments Filing System (ECFS). Anyone who’s used the web more recently than 1998 will cringe the first time they try to use ECFS to find anything, as Jerry has noted. Apart from the cumbersome, highly unintuitive interface, the problem is that there’s no way to search the text of comments ! You can only search pre-defined fields like like “law firm,” and if you don’t enter a value in precisely the right way, you get nada.

Bill Cline, the Chief of the Reference Information Center for the FCC’s Consumer & Governmental Affairs Bureau tries hard to put the best face on this farce of e-government, explaining:

A docket number is key to using ECFS, and this link takes you to the ECFS retrieval form with the docket number for the National Broadband Plan, 09-51, already filled in.  Just hit “Retrieve Document List” to get a list of all filings.  Yes, there are lots of them, and you need to click on each individual filing to read it.  But there are many ways you can focus your search, which include:

• Entering the name of a specific individual whose comments you want to see in Field 4 (Filed on Behalf of)
• Narrowing your search to people in your community by using the “City,” “State,” or “Zip Code” fields
• Entering “FCC” in Field 5 – (Law Firm) – to see FCC filings.
• Clicking on the box in field 15 (Eliminate Brief Text Comments) to narrow the search considerably by retrieving only longer comments
• Finding comments for a specific public notice by using a date range on either side of the comment due dates

Keep in mind that this the Federal Communications Commission we’re talking about here.  Yet this antiquated system hasn’t been updated in nearly six years! You might think the problem was just funding: after all, someone would have to pay for a new database system, right?  Yes, but we don’t need a new system: All the FCC has to do is set its robots.txt file to stop blocking search crawlers, so that FCC comments would be included in Google search results, as Jerry has noted.

The real absurdity here is that we naively expect these same regulatory agencies—that can’t even make their own data available through free search engines or stream their own meetings properly—to keep pace with the rapid pace of innovation on the Internet. If only the comedic geniuses at Saturday Night Live had chosen to pick on bureaucrats instead of lawyers, we’d have “Unfrozen Caveman Regulator” instead of  “Unfrozen Caveman Lawyer.” Maybe that would have made it clear to Americans how silly it is to give the least technologically competent among us control over technology, innovation and creativity—or, even better, that no one central authority is smart enough to manage it, even one led by a guy as seemingly Twitterific as Barack Obama.

Obama’s picked some good people to pull government into the Web 2.0 era, but they’ll always be fighting against the tide of institutional inertia inherent in bureaucracy. In short, we may well see a significant upgrade in e-government in the next few years, but it won’t change the basic fact that government just can’t keep pace with technological change. One need not be a libertarian to accept that this basic fact makes the Internet “different.” Thus can even a non-libertarian be a cyber-libertarian of the Internet Exceptionalist variety.

Two weeks ago, I mentioned here that John Stuart Mill’s On Liberty celebrated its 150th anniversary this year.  This year also marks the anniversary of another classic text: Adam Smith’s The Theory of Moral Sentiments, which turns 250 this year.   Although Smith will always be most closely associated with The Wealth of Nations, some Smith fans (like me) consider The Theory of Moral Sentiments to be his real masterpiece.  First published in 1759, the book is a far more robust theory of life, ethics, human relations, and justice.  Indeed, as Dan Klein and Russ Roberts of George Mason University note in this excellent podcast, The Wealth of Nations is best viewed as an installment in, or an extension of, a much larger project that Smith really brought together more holistically in Theory of Moral Sentiments. [Note: Klein and Roberts have an amazing 6-part podcast series celebrating the 250th anniversary of the book, all of which can be found here].

Rarely has any moral philosopher gotten to his point quicker — namely in the very first line of the first page of the text — than Smith did in Theory of Moral Sentiments.  Smith wanted to show that man is both self-regarding and other-regarding, and that these seemingly contradictory notions were actually quite complementary.  In other words, “self-interest” (properly understood) and empathy for others could be reconciled:

How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it. Of this kind is pity or compassion, the emotion we feel for the misery of others, when we either see it, or are made to conceive it in a very lively manner. That we often derive sorrow from the sorrows of others, is a matter of fact too obvious to require any instances to prove it; for this sentiment, like all the other original passions of human nature, is by no means confined to the virtuous or the humane, though they perhaps may feel it with the most exquisite sensibility. The greatest ruffian, the most hardened violator of the laws of society, is not altogether without it. [Book I, Chap. 1]

These opening lines make it clear why those who have criticized Smith’s theories as based on nothing more that greed or selfishness simply don’t know what they are talking about.  While it is true that self-interest motivates a great deal of human behavior, sympathy for others and proper regard for their opinions and desires is an equally important driver of human sentiments and morality.  As my former boss Dr. Eamonn Butler noted in this 2001 preface to the book:

[Smith held] that people are born with a moral sense, just as they have inborn ideas of beauty or harmony. Our conscience tells us what is right and wrong: and that is something innate, not something given us by lawmakers or by rational analysis. And to bolster it we also have a natural fellow-feeling, which Smith calls “sympathy”. Between them, these natural senses of conscience and sympathy ensure that human beings can and do live together in orderly and beneficial social organizations. So our morality is the product of our nature, not our reason. And Smith would go on to argue that the same ‘invisible hand’ created beneficial social patterns out of our economic actions too. The Theory of Moral Sentiments establishes a new liberalism, in which social organization is seen as the outcome of human action but not necessarily of human design. Indeed, our unplanned social order is far more complex and functional than anything we could reason out for ourselves (a point which Marxist politicians forgot, to their cost).

That’s about as concise of a summary of the book as I’ve ever seen and it also points to what I regard as Smith’s profoundly optimistic view of humanity and human nature, something he rarely gets credit for.  Smith himself summarizes the origins of moral philosophy most concisely late in Book VII, Chapter 3:

When we approve of any character or action, the sentiments which we feel, are, according to the foregoing system, derived from four sources, which are in some respects different from one another. First, we sympathize with the motives of the agent; secondly, we enter into the gratitude of those who receive the benefit of his actions; thirdly, we observe that his conduct has been agreeable to the general rules by which those two sympathies generally act; and, last of all, when we consider such actions as making a part of a system of behaviour which tends to promote the happiness either of the individual or of the society, they appear to derive a beauty from this utility, not unlike that which we ascribe to any well-contrived machine.

I could go on all day and unpack each of those 4 items, but you can read the book yourself and do so. If I had to summarize the central lessons of Smith’s moral philosophy in just a few words or phrases, they would be as follows:

(1) be responsible;

(2) do no harm; and

(3) help others when you can (or at least give great consideration / deference to their views /desires).

And, generally speaking, Smith believes that, if left to their own devices, that’s exactly what most people will do. They will balance their own self-interests and the interests and wishes of others.

I’ll just paste in a few of my favorite passages from Smith’s Theory of Moral Sentiments below.  [Note: Page numbers refer to the Liberty Fund’s 1984 edition of the book.]

>> On justice, generally speaking, and the priority of liberty:

There can be no proper motive for hurting our neighbour, there can be no incitement to do evil to another, which mankind will go along with, except just indignation for evil which that other has done to us. To disturb his happiness merely because it stands in the way of our own, to take from him what is of real use to him merely because it may be of equal or of more use to us, or to indulge, in this manner, at the expence of other people, the natural preference which every man has for his own happiness above that of other people, is what no impartial spectator can go along with. [Book II, Chap. 2., p. 82]

This would, of course, influence the “one simple principle” for a just society John Stuart Mill would articulate 100 years later, which stated: “the sole end for which mankind are warranted, individually or collectively, in interfering with the liberty of action of any of their number, is self-protection.”

>> On self-interest & personal responsibility:

Every man is, no doubt, by nature, first and principally recommended to his own care; and as he is fitter to take care of himself than of any other person, it is fit and right that it should be so. Every man, therefore, is much more deeply interested in whatever immediately concerns himself, than in what concerns any other man: and to hear, perhaps, of the death of another person, with whom we have no particular connexion, will give us less concern, will spoil our stomach, or break our rest much less than a very insignificant disaster which has befallen ourselves. [Book II, Sec. 2, Chap. 2., p. 82-3]

And then later in Book VI, he reiterates this point:

Every man, as the Stoics used to say, is first and principally recommended to his own care; and every man is certainly, in every respect, fitter and abler to take care of himself than of any other person. Every man feels his own pleasures and his own pains more sensibly than those of other people. The former are the original sensations; the latter the reflected or sympathetic images of those sensations. The former may be said to be the substance; the latter the shadow. [Book VI, Sec. 2, Chap. 1, p. 219.]

>> On justice and the ranking of rights:

Death is the greatest evil which one man can inflict upon another, and excites the highest degree of resentment in those who are immediately connected with the slain. Murder, therefore, is the most atrocious of all crimes which affect individuals only, in the sight both of mankind, and of the person who has committed it. To be deprived of that which we are possessed of, is a greater evil than to be disappointed of what we have only the expectation. Breach of property, therefore, theft and robbery, which take from us what we are possessed of, are greater crimes than breach of contract, which only disappoints us of what we expected. The most sacred laws of justice, therefore, those whose violation seems to call loudest for vengeance and punishment, are the laws which guard the life and person of our neighbour; the next are those which guard his property and possessions; and last of all come those which guard what are called his personal rights, or what is due to him from the promises of others.

>> On the fatal conceit of central planning (Smith’s famous “chess-board” analogy):

The man of system, on the contrary, is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it. He goes on to establish it completely and in all its parts, without any regard either to the great interests, or to the strong prejudices which may oppose it. He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. He does not consider that the pieces upon the chess-board have no other principle of motion besides that which the hand impresses upon them; but that, in the great chess-board of human society, every single piece has a principle of motion of its own, altogether different from that which the legislature might chuse to impress upon it. If those two principles coincide and act in the same direction, the game of human society will go on easily and harmoniously, and is very likely to be happy and successful. If they are opposite or different, the game will go on miserably, and the society must be at all times in the highest degree of disorder.

I love that passage!  Many classical liberal thinkers, most notably F.A. Hayek, would go on to build on this point. But Smith really nailed it first, and quite eloquently, here in The Theory of Moral Sentiments.

Anyway, go read (or re-read) this book.  It is a masterpiece.