What’s Ultimately Being Controlled Are People’s Choices

by Don Boudreaux on July 24, 2015

in Creative destruction, Crony Capitalism, Innovation, Seen and Unseen, Technology, Work

Here’s a follow-up letter to Ms. Louise Lauderdale:

Dear Ms. Lauderdale:

Thanks for your follow-up e-mail.  Your point, if I may summarize it, is that it’s desirable for people as a group (through the democratic process), to “control” technology in order to protect people from “the anguish of job loss.”

I disagree.  First, unlike you I worry that the democratic process will too often be hijacked by crony capitalists and other interest groups.  The hijackers, while proclaiming their devotion to the public welfare, will in fact use the power of the state to control new technologies not for the purpose of promoting the public welfare but, rather, to gain and protect special privileges for themselves at the expense of the public.

Second and more fundamentally, technology as such destroys no particular jobs.  What ultimately destroys particular jobs is consumer and worker choice.  For example, the technology behind Uber is destroying the jobs of traditional cab drivers only because consumers choose to use Uber and because many workers choose to drive for Uber.  Labor-saving technologies on farms and factories are profitable only because consumers choose to pay lower rather than higher prices for the goods and services that they buy and because workers choose higher-wage options over lower-wage options: employers would introduce far fewer labor-saving techniques if workers did not allow their wages to be bid up by rival employers.

So to use the democratic process to protect particular jobs by ‘controlling’ technological progress is really to use the democratic process to protect particular jobs by controlling consumer and worker choice.  When one realizes that what’s ultimately being controlled are the peaceful choices of consumers and workers rather than the abstraction “technology,” a policy of control such as the one you endorse seems far less attractive.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA  22030

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