A Serviceable Society

By Graham Peterson

hot-waitress2Over at The New York Times Magazine, Cathreine Rampell has a nice piece called “Outsource Your Way to Success.”  She calls hiring cleaning ladies and personal chefs “outsourcing,” and tells a story about a couple of Columbia economists who hire as many personal services as possible to outsource their way to more time with their son, marriage, and careers.

Rampell’s title is provocative.  Why?  We usually call businesses turning an activity from inside the firm into a market exchange “outsourcing” in order to raise ethical indignation.  And nobody wants to turn their home into a dirty corporation.  At the root of that indignation is the idea that one who out-sources has Betrayed the Clan (or usually The State or The Neighborhood: “buy American!” or “buy local!”).  Fair play: we don’t discuss often enough the dizzying network of loyalties that make a firm and market.  But when we live in a Loyalty Is All That Matters world, we get insane conclusions about human welfare.  If you don’t divide labor and compete some — everyone ends up broke.

To source from outside the clan, or outside my own two hands pace Martha Stewart, is merely to divide labor.  That’s ancient.  Our ethical intuitions about it, though, seem not to have changed much.  We seem to cling to an old-worn aristocratic myth of the Noble Farmer and Noble Craftsman.  Why should we champion doing it yourself?  In an EXTREME D.I.Y. world (who grew up in the 90s?  EXTREME!), people suffer from such massive inefficiencies that everyone makes about $3 a day.  Ask anyone in history before industrialization.  Or the majority of citizens of the Democratic Republic of Congo.

We worry about splitting up divisions of labor because, yes, we have very nice stories built around the traditional identities in embedded in one social role or another.  But where do these stories come from?

With his crushing insight, Karl Marx formalized the intuition many had in the 19th century that the expansion of markets was merely reproducing the fantastic inequality and slavery of history.  Well now, that’s stupid.  By “deskilling” workers and allowing them to focus on getting really good at one or a few tasks, by cultivating professions, and by limiting the breadth of skills one needs, markets have put human beings in constant service of one another and increased their depth of skills.  The firm is merely an intermediary between regular folks, and bosses are beholden to the power of competition that regular folks, in aggregate, leverage.

But we don’t think about outsourcing and hiring services in such an innocuous way.  Rampell notes that people might feel a little hairy about hiring people to assemble Ikea furniture for them, like the Columbia economists have.  It stamps of aristocracy.  Just so.  One of the major reasons I left the restaurant industry, even though I was a pretty good cook, was that I didn’t like the idea of “serving the rich” for the rest of my life.

But now that too, was silly.  Who are “the rich?”  People who sweep floors callously command plebes with their janitor-dollars, in our modern world, to serve them their food and reheat their coffee if it is cold.  The intuition you see, becomes a strange argument from power when everyone has a lot of it.

To be a servant is shockingly different from providing a service, and we ought to note it.  Servants were often not free in their property of person, nor free to force their employers to compete for their services on a market, bidding up their wages: “I’m sorry, my Liege, but the Duchess of Norman is advertising a horse more, and dental, in exchange for my sweeping.  Swiftly I must go.”

Yet people fear that an increasing service economy will look like plebes and kings.  People sense that providing flimsy services doesn’t really make anything, as against Making Widgets which does.  They sense that (more services) –> (more poverty).  So I ask you: are iPhones real wealth?  I bet you enjoy an extraordinary stream of services from your smart phone.  See, then, that all the “real wealth” that “real goods” provide you with, is ultimately a stream of services.  The usefulness and utility of objects is culturally determined, and all there ever was in any market, was a service economy.

We have no idea what the crazy variety of services there are to be invented will look like.  But we do know it will happen.  And in an economy with rising income for its poorest members who are able to demand such services (that is, factually, our economy), it’s strange to think that we should abhor a future world in which people run around doing their best to serve one another as a product of greater and greater outsourcing.  What a pity of human greed, poverty, and misery this helpful world is.

 

 

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10 thoughts on “A Serviceable Society”

  1. I applaud Peterson’s call to liberate us from the guilt of outsourcing domestic responsibilities, but where the stream of consciousness goes from there is a bit confusing.

    So the outcome is families (particularly women it appears, given the examples and the work in question – domestic) do not outsource mostly domestic tasks in situations where it clearly makes economic sense. The rest of the article also mentions some other benefits, but the primary one is the economic pay-off in terms of opportunity costs.

    The NYT opinion piece, not surprisingly, doesn’t rigorously deal with the causal factor of culture. And both the NYT article and Peterson missed the other major causal factor – gender norms.

    The following sentence from Peterson’s second paragraph confuses me: “We usually call businesses turning an intra-firm activity into an inter-firm market exchange “outsourcing” in order to raise ethical indignation.” Perhaps I might recap some recent history with which we all may be familiar. That’s not why we usually call firms doing that “outsourcing,” because we want to raise ethical indignation. We call it outsourcing because in the business world when we started doing it like gang busters beginning in the late 80’s, that’s what it was. What else would you call it??? And it was perceived to be good thing! All the rage, in fact!

    Now the negative cultural meaning that Peterson attributes to outsourcing was a union event that happened later, but in the private world, it had been (the part about domestic servants) and remained an “ok” thing to do….UNTIL…..Dah! Dah! Duhhhhh! The success of Martha Stewart and people like her at about the same time during the 80’s and 90’s. (As much as Martha is emblematic of female entrepreneurial spirit and the progress it indicates, I personally believe she was single-handedly responsible for a generation of women – who happened to be in their 30s during that same time – having a really crappy decade or two of their life.) The DIY Network and similar magazines flourished and millions of women were thrust back into the kitchen out of guilt and out-doing the imaginary Joneses. But no one was really a 50s era Jones anymore with the necessity of dual-earner homes and single-parent homes, but the specter of them loomed large.

    These facts are sprinkled throughout the NYT’s article and Peterson’s piece, but they are never followed to their logical conclusion, which is that they are produced and reproduced by cultural gender norms

    The NYT article Arthur had her thumb on the right mechanism when she referred to “anti-outsourcing mores,” and wrote, “strong cultural aversion to certain forms of outsourcing.” This is hardly about economics and the rational actor, which I don’t think the article or Peterson is arguing, but it is the only logic that’s mentioned. The cultural logics are never clearly addressed. I argue since these cause aren’t clearly stated as a gender problem, none of us knows how to propose action to create change.

    I want to more clearly address the necessity of pinning this down as a gender issue. Peterson writes, “Yet people insist that an increasing service economy will look like plebes and kings.” I’m not sure who the “people” are, but the richest amongst us in the US economy are part of the ever burgeoning service economy. The service economy is not only cleaning personnel and cooks (btw, there are some pretty big star cooks out there, so kinda confused about them being lumped in with the plebes), but it also includes the hedge fund manager and the high powered attorney. (Read a little Sassen, Castells or Florida, why don’t ya.) Notice though that these professions are dominated by men. Women dominate many of the “plebian” service economy jobs.

    Let us use an anecdote to explain what I think the literature on family and gender has been arguing repeatedly over the past 50 years. (Yeah yeah anecdotes are an n of 1, blah blah blah….but sometimes it’s easier to explain a phenomenon through the use of a reality-based parable.) So, I completely agree with the idea of personal outsourcing. My longest and best girlfriend is an upper level federal agent in homeland security. On average, she gets sucked into about 60-80 hours a week at work. Two months ago, I spent an hour on the phone convincing her that not only did it make economic sense for her ***not*** to spend her precious weekend time cleaning her house given what she paid the cleaning personnel and her own hourly wage, but that it also made solid emotional sense. The latter was a tougher battle that had less to do with the economic rationality of it and more to do with the emotional responsibility and guilt. “Think about how much more time you could spend with your husband and family,” I said. “Think about the extra energy you’d have to take care of yourself,” I reasoned. And on and on and on….I had to use an emotional argument to address an emotional concern. You know who also had an issue with her outsourcing the housecleaning that she spent half of a weekend day doing? Her husband who had the **exact same job** as she did. I don’t think he’s some Neanderthal jerk who wants to keep his woman in the kitchen. I didn’t ask, but I am going to hypothesize that it’s as simple as, “It just doesn’t feel right.” They did get a cleaning service and both agree it was the best decision they even made. Why so much angst about it, though??

    Let’s try another little real-life parable. I was a nanny/tutor to a 12 year-old boy with a helicopter mom who worked out of her home as a fulltime Freudian psychologist (no, I’m serious). The kid spilled some corn flakes all over the rug. When I asked her where the vacuum was in her own home, she had no idea. Not only did she not know where it was, but she had no idea how to work it. I gave her a look that must has communicated “you are an idiot.” …I didn’t last long in that job.

    I made a value-judgment about her and I’m not sure I would have made the same judgment of her husband. I do firmly believe that she AND her husband should both know the location of and how to work their own vacuum cleaner, even when they outsource all of the cleaning. What are the cultural norms at work here? This isn’t about my aversion to “outsourcing”. And this woman, my friend, her husband, and myself, certainly were not thinking about Marx, as Peterson suggests. That’s not where homo civicus obtains her, “nice stories built around the traditional identities in embedded in one social role or another” [sic] when we engage in these daily interactions. And I don’t think scholars cling to it either (who exactly is the “we” to which Peterson refers in that passage?). Regardless, this explanation is not going to get us towards any reasonable model for CHANGE.

    And by the way, I have excellent cleaning skills and take price in a tidy home (don’t always manage to keep it immaculate), but yeah, I have a cleaning service come in once a month.

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  2. Elizabeth makes a strong point. I was trying to demonstrate, like her post agrees, that our ethical frameworks about what is an isn’t appropriate to hire someone in a market to do, or to hire-out, outside of the firm, influence the cost-benefit analysis of the decision to do so. To continue with the economic phrasing (since I’m making an economic point about the efficiencies of the division of labor), there are enormous frictions involved in whether or not people will “outsource” something that was once considered DIY material, either for the self or for the firm. Factors of production do not in these cases often frictionlessly substitute toward their highest-productivity margin of use, at least not in terms of the observable material margins — there is a great deal of “ethical baggage in the utility function,” if you will. So yes, my point is that personal identities make up a great deal of the decision of whether and when and where to create market transactions where there wasn’t one before, and yes, in the specific instance of domestic labor, our gendered norms influence these decisions. The fundamental problem I have here, as the pro-market advocate, is that people often see turning one or another activity into an economic transaction as a mark of laziness and fecklessness — that goes for a country boy in Kentucky realizing that it’s more efficient to have someone else change his oil for him as much as a soccer mom negotiating whether she’s a good woman if someone else packs her kid’s lunches for them. A lot of these framings reduce to those handed down from aristocratic philosophers and artists in history, who almost uniformly saw markets as utterly profane. So these days we continue with rank skepticism whenever someone suggests that a market transaction would increase both our material an existential productivity, in organs for markets, say, and house cleaning.

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  3. Ok, real response:

    There is much about which Peterson and I probably agree. However, I do not agree with the position from which he makes his argument, because I believe it has serious implications for the solutions resulting from such a foundation.

    I’m not making an economic argument or a sociological argument or an anthropological one or a historical one, etc. I’m making a realistic argument. To live in reality, one can’t just make “an economic argument” (as Peterson says to defend his point) and actually address the problem and work towards a solution that makes the lives of real people living it better. (We’re not talking some lab model.) Such a statement signals to me, “I’m making an esoteric theoretical argument, so stop judging me based on reality.” I don’t think that’s what Peterson means, but his choice of phrasing makes me suspicious.

    Let’s give Peterson the benefit of the doubt and deal with the “fundamental problem” he has about the people’s knee-jerk reaction causing them to not want to turn to an economic transaction because of it being labeled as “laziness and fecklessness.” (Good analogy with the Kentuckian boy….how long did it take to come up with that nice gender example?) First, that’s too simplistic. No, wait, the answer may actually be that simple, but those particular accusations are spurious. I think the underlying cultural cause is much different. Again, gender. And the changing the oil is just as gendered as the soccer mom. (….again, impressed with that analogy.) Anyhow, I’m not interested in getting into this now, so I’ll leave it at that.

    Second, to dumb this framing down to being handed down from aristocratic philosophers and artists in history is another ivory tower argument (yeah, I said “dumb”). This is a bottom-up phenomenon, not a top down one. Why is this distinction so important? Because changing the minds of people in the academe will get you nowhere. It’s kind of ironic, but it’s like Peterson is making a Hegelian argument about idealism when he really should go back to the materialistic roots of the individual. Devil’s in the detail my friends.

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  4. “I’m making an esoteric theoretical argument, so stop judging me based on reality.” is a caricature of economic theory. There is uncontroversial evidence that the division of labor has made people fantastically materially better off with the expansion of markets and economic growth.

    And the idea that markets were disdained in history by aristocrats, and that those mores were supported and promoted by religious thinkers, artistic patrons of aristocrats, and so forth, is well-documented. The idea that people get their stories about the world from an intellectual marketplace seems reasonable to me, and when production of those ideas was constrained by the institutions of intellectual barrier-construction, people on the ground had few choices (like Venezuelans and their choice of fuel suppliers).

    I don’t disagree that there is a bottom-up demand for ideas and that people co-create them with one another. I’m saying that this marketplace was artificially constrained for thousands of years and the remnants of such conventional mores persist in people’s ethical intuitions.

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    1. Au contraire. My comment was not a blanket statement about all economists. It was specific to the particular line of argumentation Peterson was taking. And to apply an argument about how aristocrats and religious thinkers in history disdained the market to micro-interaction happening within the family this week shows a real disconnect. Finally, “bottom-up DEMAND for ideas”. I think Peterson misunderstood me here. No, not a demand, I’m talking about CREATION of ideas. Where they come from, not who is demanding them. The only people who seem to demand them are academics, who want to study them.

      Tsk tsk. Poor picked-on economists. Instead of dealing with my criticism of the argument, it’s like I’ve been accused of being a racist so that all logical argumentation will stop. Cheap blow. …alas, I’m a forgiving person. So, forgiven you are.

      Instead, let me propose a plan for progress:

      Let’s 1) pin down points of agreement, 2) clarify our question, and 3) get back to the germane aspects of the argument.

      1a. I think we agree that a service market can be a very helpful and even economically good thing for the family. (We will limit out case and refrain from expanding to the entirety of the service economy that include lawyers, wealth managers, etc.).

      1b. We appear to believe that some sort of cultural belief system is responsible for the resistance to out-sourcing home tasks to the service market.

      2a. Why are people resistance to the service market (in the case of home-based services)?

      2b. Given 1b, what are the sources for changing the prevailing resistance?

      3a. If parts 1 and 2 can be agreed upon by all, then the argument seems to be how to change the culture in the homes of people in the US? Peterson suggests we can change the marketplace of ideas in academia, believing that there is a trickle-down effect.

      3b. I argue that 3a is all well and good for the ivory tower and large corporations. However, the family unit works differently. Consequently, changing what she believes to be an aspect of society that is purposively separated from those aforementioned worlds of higher academia and large corporations in which ideas may (or may not) trickle down will do nothing to change what is happening in the [nuclear?] family. Ultimately, the argument is that the cultural transference of social norms and values are different for the two social environments.

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  5. I believe that people’s ethics about markets can be influenced with academic writing and public intellectual work, and bloggin’, yes.

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