The Rational Optimist: How Prosperity Evolves

The multiplication of labour

You are not just consuming the labour and resources of others. You are consuming others’ inventions, too. A thousand entrepreneurs and scientists devised the intricate dance of photons and electrons by which your television works. The cotton you wear was spun and woven by machines of a type whose original inventors are long-dead heroes of the industrial revolution. The bread you eat was first cross-bred by a Neolithic Mesopotamian and baked in a way that was first invented by a Mesolithic hunter-gatherer. Their knowledge is enduringly embodied in machines, recipes and programmes from which you benefit. Unlike Louis, you number among your servants John Logie Baird, Alexander Graham Bell, Sir Tim Berners-Lee, Thomas Crapper, Jonas Salk and myriad assorted other inventors. For you get the benefit of their labours, too, whether they are dead or alive.

The point of all this cooperation is to make (Adam Smith again) ‘a smaller quantity of labour produce a greater quantity of work’. It is a curious fact that in return for this cornucopia of service, you produce only one thing. That is to say, having consumed the labour and embodied discoveries of thousands of people, you then produce and sell whatever it is you do at work – haircuts, ball bearings, insurance advice, nursing, dog walking. But each of those thousands of people who work ‘for’ you is equally monotonously employed. Each produces one thing. That is what the word ‘job’ means: it refers to the simplified, singular production to which you devote your working hours. Even those who have several paying jobs – say, freelance short-story writer/neuroscientist, or computer executive/photographer – have only two or three different occupations at most. But they each consume hundreds, thousands, of things. This is the diagnostic feature of modern life, the very definition of a high standard of living: diverse consumption, simplified production. Make one thing, use lots. The self-sufficient gardener, or his self-sufficient peasant or hunter-gatherer predecessor (who is, I shall argue, partly a myth in any case), is in contrast defined by his multiple production and simple consumption. He makes not just one thing, but many – his food, his shelter, his clothing, his entertainment. Because he only consumes what he produces, he cannot consume very much. Not for him the avocado, Tarantino or Manolo Blahnik. He is his own brand.

In the year 2005, if you were the average consumer you would have spent your after-tax income in roughly the following way:

 20 per cent on a roof over your head

 18 per cent on cars, planes, fuel and all other forms of transport

 16 per cent on household stuff: chairs, refrigerators, telephones, electricity, water

 14 per cent on food, drink, restaurants etc

 6 per cent on health care

 5 per cent on movies, music and all entertainment

 4 per cent on clothing of all kinds

 2 per cent on education

 1 per cent on soap, lipstick, haircuts, and such like

 11 per cent on life insurance and pensions (i.e., saved to secure future spending)

 and, alas from my point of view, only 0.3 per cent on reading

An English farm labourer in the 1790s spent his wages roughly as follows:

 75 per cent on food

 10 per cent on clothing and bedding

 6 per cent on housing

 5 per cent on heating

 4 per cent on light and soap

A rural peasant woman in modern Malawi spends her time roughly as follows:

 35 per cent farming food

 33 per cent cooking, doing laundry and cleaning

 17 per cent fetching water

 5 per cent collecting firewood

 9 per cent other kinds of work, including paid employment

Imagine next time you turn on the tap, what it must be like to walk a mile or more to the Shire River in Machinga province, hope you are not grabbed by a crocodile when filling your bucket (the UN estimates three crocodile deaths a month in the Machinga province, many of them of women fetching water), hope you have not picked up a cholera dose in your bucket, then walk back carrying the 20 litres that will have to last your family all day. I am not trying to make you feel guilty: I am trying to tease out what it is that makes you well off. It is having the hard work of living made easy by markets and machines and other people. There is probably nothing to stop you fetching free water from the nearest river in your home town, but you would rather pay something from your earnings to get it delivered clean and convenient from your tap.

So this is what poverty means. You are poor to the extent that you cannot afford to sell your time for sufficient price to buy the services you need, and rich to the extent that you can afford to buy not just the services you need but also those you crave. Prosperity, or growth, has been synonymous with moving from self-sufficiency to interdependence, transforming the family from a unit of laborious, slow and diverse production to a unit of easy, fast and diverse consumption paid for by a burst of specialised production.

Self-sufficiency is poverty

It is fashionable these days to decry ‘food miles’. The longer food has spent travelling to your plate, the more oil has been burnt and the more peace has been shattered along the way. But why single out food? Should we not protest against T-shirt miles, too, and laptop miles? After all, fruit and vegetables account for more than 20 per cent of all exports from poor countries, whereas most laptops come from rich countries, so singling out food imports for special discrimination means singling out poor countries for sanctions. Two economists recently concluded, after studying the issue, that the entire concept of food miles is ‘a profoundly flawed sustainability indicator’. Getting food from the farmer to the shop causes just 4 per cent of all its lifetime emissions. Ten times as much carbon is emitted in refrigerating British food as in air-freighting it from abroad, and fifty times as much is emitted by the customer travelling to the shops. A New Zealand lamb, shipped to England, requires one-quarter as much carbon to get on to a London plate as a Welsh lamb; a Dutch rose, grown in a heated greenhouse and sold in London, has six times the carbon footprint of a Kenyan rose grown under the sun using water recycled through a fish farm, using geothermal electricity and providing employment to Kenyan women.

In truth, far from being unsustainable, the interdependence of the world through trade is the very thing that makes modern life as sustainable as it is. Suppose your local laptop manufacturer tells you that he already has three orders and then he is off on his holiday so he cannot make you one before the winter. You will have to wait. Or suppose your local wheat farmer tells you that last year’s rains means he will have to cut his flour delivery in half this year. You will have to go hungry. Instead, you benefit from a global laptop and wheat market in which somebody somewhere has something to sell you so there are rarely shortages, only modest price fluctuations.

For example, the price of wheat approximately trebled in 2006–8, just as it did in Europe in 1315–18. At the earlier date, Europe was less densely populated, farming was entirely organic and food miles were short. Yet in 2008, nobody ate a baby or pulled a corpse from a gibbet for food. Right up until the railways came, it was cheaper for people to turn into refugees than to pay the exorbitant costs of importing food into a hungry district. Interdependence spreads risk.

The decline in agricultural employment caused consternation among early economists. François Quesnay and his fellow ‘physiocrats’ argued in eighteenth-century France that manufacturing produced no gain in wealth and that switching from agriculture to industry would decrease a country’s wealth: only farming was true wealth creation. Two centuries later the decline in industrial employment in the late twentieth century caused a similar consternation among economists, who saw services as a frivolous distraction from the important business of manufacturing. They were just as wrong. There is no such thing as unproductive employment, so long as people are prepared to buy the service you are offering. Today, 1 per cent works in agriculture and 24 per cent in industry, leaving 75 per cent to offer movies, restaurant meals, insurance broking and aromatherapy.

Arcadia redux

Yet, surely, long ago, before trade, technology and farming, human beings lived simple, organic lives in harmony with nature. That was not poverty: that was ‘the original affluent society’. Take a snapshot of the life of hunter-gathering human beings in their heyday, say at 15,000 years ago well after the taming of the dog and the extermination of the woolly rhinoceros but just before the colonisation of the Americas. People had spear throwers, bows and arrows, boats, needles, adzes, nets. They painted exquisite art on rocks, decorated their bodies, traded foods, shells, raw materials and ideas. They sang songs, danced rituals, told stories, prepared herbal remedies for illnesses. They lived into old age far more frequently than their ancestors had done.

They had a way of life that was sufficiently adaptable to work in almost any habitat or climate. Where every other species needed its niche, the hunter-gatherer could make a niche out of anything: seaside or desert, arctic or tropical, forest or steppe.

A Rousseauesque idyll? The hunter-gatherers certainly looked like noble savages: tall, fit, healthy, and (having replaced stabbing spears with thrown ones) with fewer broken bones than Neanderthals. They ate plenty of protein, not much fat and ample vitamins. In Europe, with the help of increasing cold, they had largely wiped out the lions and hyenas that had both competed with and preyed upon their predecessors, so they had little to fear from wild animals. No wonder nostalgia for the Pleistocene runs through many of today’s polemics against consumerism. Geoffrey Miller, for example, in his excellent book Spent, asks his readers to imagine a Cro-Magnon mother of 30,000 years ago living ‘in a close-knit clan of family and friends…gathering organic fruits and vegetables…grooming, dancing, drumming and singing with people she knows, likes and trusts…the sun rising over the six thousand acres of verdant French Riviera coast that her clan holds.’

Life was good. Or was it? There was a serpent in the hunter-gatherer Eden – a savage in the noble savage. Maybe it was not a lifelong camping holiday after all. For violence was a chronic and ever-present threat. It had to be, because – in the absence of serious carnivore predation upon human beings – war kept the population density below the levels that brought on starvation. ‘Homo homini lupus’, said Plautus. ‘Man is a wolf to man.’ If hunter-gatherers appeared lithe and healthy it was because the fat and slow had all been shot in the back at dawn.

Here is the data. From the !Kung in the Kalahari to the Inuit in the Arctic, two-thirds of modern hunter-gatherers have proved to be in a state of almost constant tribal warfare, and 87 per cent to experience annual war. War is a big word for dawn raids, skirmishes and lots of posturing, but because these happen so often, death rates are high – usually around 30 per cent of adult males dying from homicide. The warfare death rate of 0.5 per cent of the population per year that was typical of many hunter-gatherer societies would equate to two billion people dying during the twentieth century (instead of 100 million). At a cemetery uncovered at Jebel Sahaba, in Egypt, dating from 14,000 years ago, twenty-four of the fifty-nine bodies had died from unhealed wounds caused by spears, darts and arrows. Forty of these bodies were women or children. Women and children generally do not take part in warfare – but they are frequently the object of the fighting. To be abducted as a sexual prize and see your children killed was almost certainly not a rare female fate in hunter-gatherer society. After Jebel Sahaba, forget the Garden of Eden; think Mad Max.

It was not just warfare that limited population growth. Hunter-gatherers are often vulnerable to famines. Even when food is abundant, it might take so much travelling and trouble to collect enough food that women would not maintain a sufficient surplus to keep themselves fully fertile for more than a few prime years. Infanticide was a common resort in bad times. Nor was disease ever far away: gangrene, tetanus and many kinds of parasite would have been big killers. Did I mention slavery? Common in the Pacific north-west. Wife beating? Routine in Tierra del Fuego. The lack of soap, hot water, bread, books, films, metal, paper, cloth? When you meet one of those people who go so far as to say they would rather have lived in some supposedly more delightful past age, just remind them of the toilet facilities of the Pleistocene, the transport options of Roman emperors or the lice of Versailles.

The call of the new

None the less, you do not have to be starry-eyed about the Stone Age to find aspects of modern consumer society obscenely wasteful. Why, asks Geoffrey Miller, ‘would the world’s most intelligent primate buy a Hummer H1 Alpha sport-utility vehicle’, which seats four, gets ten miles to the gallon, takes 13.5 seconds to reach 60 mph, and sells for $139,771? Because, he answers, human beings evolved to strive to signal social status and sexual worth. What this implies is that far from being merely materialist, human consumption is already driven by a sort of pseudo-spiritualism that seeks love, heroism and admiration. Yet this thirst for status then encourages people to devise recipes that rearrange the atoms, electrons or photons of the world in such a way as to make useful combinations for other people. Ambition is transmuted into opportunity. It was allegedly a young Chinese imperial concubine in 2600 bc who thought up the following recipe for rearranging beta pleated sheets of glycine-rich polypeptides into fine fabrics: take a moth caterpillar, feed it mulberry leaves for a month, let it spin a cocoon, heat it to kill it, put the cocoon in water to unstick the silk threads, carefully draw out the single kilometre-long thread from which the cocoon is made by reeling it on to a wheel, spin the thread and weave a fabric. Then dye, cut and sew, advertise and sell for cash. Rough guide on quantities: it takes about ten pounds of mulberry leaves to make 100 silkworm cocoons to make one necktie.

The cumulative accretion of knowledge by specialists that allows us each to consume more and more different things by each producing fewer and fewer is, I submit, the central story of humanity. Innovation changes the world but only because it aids the elaboration of the division of labour and encourages the division of time. Forget wars, religions, famines and poems for the moment. This is history’s greatest theme: the metastasis of exchange, specialisation and the invention it has called forth, the ‘creation’ of time. The rational optimist invites you to stand back and look at your species differently, to see the grand enterprise of humanity that has progressed – with frequent setbacks – for 100,000 years. And then, when you have seen that, consider whether that enterprise is finished or if, as the optimist claims, it still has centuries and millennia to run. If, in fact, it might be about to accelerate to an unprecedented rate.

If prosperity is exchange and specialisation – more like the multiplication of labour than the division of labour – then when and how did that habit begin? Why is it such a peculiar attribute of the human species?