Video: The Miracle of the Pencil...And everything else...

In posting just before this one I extolled the virtues of the Capitalism and Creative Destruction (by implication) through a high tech device---a Smartphone.  Now, I would like to do the same with a
very low tech device---a Pencil!

Here is a nice video (about 6 minutes long) illustrating the Miracle of the Pencil and how it comes to the marketplace.  Innumerable resources and activities have to be co-ordinated to create such a simple thing at such a low price.  Look at a pencil, then look at EVERYTHING else around you.  Think about the effort it took to get those things within your reach. 

I dont think the word miracle is that far-fetched...

HT: Cafe Hayek and the links from there...

Nice interview with Bill Gates on energy and the environment---He even uses the term Opportunity Costs...NICE!!!

In a discussion on energy, Mr Gates invokes the important economic term "Opportunity Cost". He uses it terms of using land to produce food for either human consumption or energy production.  Trying to solve one problem (clean energy) creates unintended consequences (well, dead people from starvation/malnutrition).  I encourage you to read the whole interview (rather short).  He has some good insights and touches on many behavorial economic concepts as well the state of alternative energy on a macro and micro level. 

Q&A: Bill Gates on the World Energy Crisis

Anderson: When you look at the big picture, where should we be focusing besides nuclear? On massive solar plants in the desert? On middle-size stuff for office roofs? Or is there a reinvention that could be done right in the home?

Gates: If you’re going for cuteness, the stuff in the home is the place to go. It’s really kind of cool to have solar panels on your roof. But if you’re really interested in the energy problem, it’s those big things in the desert.

Rich countries can afford to overpay for things. We can afford to overpay for medicine, we can overpay for energy, we can rig our food prices and overpay for cotton. But in the world where 80 percent of Earth’s population lives, energy is going to be bought where it’s economical. People are going to buy cheap fertilizer so they can grow enough crops to feed themselves, which will be increasingly difficult with climate change.

You have to help the rest of the world get energy at a reasonable price to get anywhere. It’s great to have the rich world, because we’re there to think about long-term problems and fund the R&D. But we get sloppy, because we’re rich. For example, despite often-heard claims to the contrary, ethanol has nothing to do with reducing CO₂; it’s just a form of farm subsidy. If you’re using first-class land for biofuels, then you’re competing with the growing of food. And so you’re actually spiking food prices by moving energy production into agriculture. For rich people, this is OK. For poor people, this is a real problem, because their food budget is an extremely high percentage of their income. As we’re pushing these things, poor people are driven from having adequate food to not having adequate food.

The most interesting biofuel efforts avoid using land that’s expensive and has high opportunity costs. They do this by getting onto other types of land, or taking advantage of byproducts that aren’t used in the food chain today, or by intercropping....""

The whole article is HERE...

Is re-paving a road "stimulative" to the economy? Compare these two photos. Are we using 1930's policies to solve 2011 problems?

Are "infrastructure projects" stimulating to the economy like they were during the Depression?  Are we using 1930's policies to solve 2011 problems? If the goal is to implement the use of machines/capital then we are doing the right thing. Road projects are a necessity, that is clear. But to justify them on the basis that they are, in large part, going to get our economy back on track and significantly lower unemployment seems a bit of a stretch to me.  If the goal of stimulus is to employ the masses, then, well, perhaps we should ask if "shovel-ready" is a literal or figurative term. More focus should be on the jobs of the future, not of the past...Just sayin'.

Repaving a road in Louisiana in the 1930's with a mix of labor and technology/capital...count the workers relative to capital...

Source HERE


Repaving a road today in Louisiana with today's mix of labor and technology...count the workers relative to capital

Source HERE

I assume the road in the bottom picture was done in a day or so and the road in the first picture took, well, I don't know how many days (weeks?)...

Nice video showing the manufacture of a Model T...Compare it to the production of a Mercedes today...What a difference a 100 years makes!

A nice video showing the manufacture of the Ford Model T.  It is a good example of how technology has changed in a little over a century and how labor has become a smaller part of the whole process of making a car.  The second video is a modern Mercedes-Benz factory...WOW! Nary a person in sight! (HT: CafeHayek)

A machine that picks Strawberries...there go MORE jobs...Dang technology!!

But what about the workers who will lose their jobs? This type of technological advance must be stopped, so would say a Luddite...

"The Institute of Agricultural Machinery at Japan's National Agriculture and Food Research Organization, along with SI Seiko, has developed a robot that can select and harvest strawberries based on their color. Ripened berries are detected using the robot's stereoscopic cameras, and analyzed to measure how red they appear. When the fruit is ready to come off the vine, the robot quickly locates it in 3D space and cuts it free. From observation to collection, the harvesting process takes about 9 seconds per berry. Creators estimate that it will be able to cut down harvesting time by 40%."---Source HERE