In other words, economic growth rises to the aggregate level of our actual production and consumption, and the money we print for that process. What's more, we're kidding ourselves whenever we put a stop to multiple means of production, and yet still expect everyone to be financially responsible for their own circumstance. Some in power may think it's possible to define wealth outside the perimeters of actual human participation. But in the long run, economic equilibrium always knows the difference.
Ongoing learning is a primary investment; skills sets and the mental spaces we inhabit, our calling cards. And yet, these forms of capital still end up outside the realm of economic activity that became the early 21st century. Presently, we are actually working harder to keep knowledge use out of the marketplace than we would be, if the tide of knowledge flowed around the barriers that have been placed in its path.
How do we know the tide is being held back? Think about the locations where knowledge and important information are "allowed entry". That is, for what society has deemed important enough to actually consider with randomly mined time value (i.e. not necessarily accomplish). It's an overwhelming environment, where everything of significance that needs to be happen, is trying to materialize along the same channels and limited time frames. From Shane Parrish (Farnam Street):
I'm hard pressed to think of an environment less conducive to rational decisions than that of the modern office worker...Environments play an important role on individual and collective abilities to make decisions and yet most organizations spend zero time thinking about this.Of course the problem here is that organizations can't really remedy the problem on their own. What this really comes down to is that we have not yet learned to think of many important services in a true market based sense. Even monetary policy can miss this to a degree, in that additional stimulus also has the capacity to add to the service product options (and participants) that gain entry into the marketplace, before translating into higher prices. Or said another way, tight money can also lower divisions of services differentiation in a quantitative sense.
Services have mostly been provisioned in three ways: government redistribution, individuals with high discretionary income, or else randomly mined by institutions in general. That is, even though our time is a fixed scarcity, it came to be used in the 20th century as a random scarcity. Other service utilization remains cultural, religious, or outside of the bounds of rationality (i.e. near slavery or prisoner like conditions). That means we haven't really been free to coordinate services with one another as individuals: a reality which puts many men, women and young adults into compromised realities. Until services are recognized as a valuable form of product in their own right, their status as real wealth remains in jeopardy. When we think about substantial supply shocks, it becomes apparent that services of all kinds are disrupted - not just in depressions but recessions as well.
Today, governments are implored to reduce their budgets, and institutions of all kinds tend to the bottom line by reducing services needs to a bare minimum. Consequently, individuals with discretionary income are the only ones expanding services needs in a relative sense. Even if knowledge use is being funded, the purpose of that use may be different from the perspective of those who contribute time value. Thus in the aggregate - even with private substitution - knowledge use for multiple areas continues to decline in a monetary sense.
In the 20th century, even though we were making investments to improve the quality of our time use, we were still - unfortunately - moving away from the concept of our time as holding intrinsic worth outside of institutional structure. Prior to mass employment, time use took place primarily in managerial terms. That is, time value was structured so as to be responsible for a wide variety of resource combinations in one's immediate environment. Home economics was just one aspect of this reality, and management didn't necessarily mean status just as it doesn't necessarily mean so now.
Even though the 21st century strongly suggests a return to general environment management, it has become difficult to break away from the idea of time use as secondary to hierarchy. For many groups, boss and employee structures are all they've ever known. What's more, management models suggested in the present exist in conjunction with highly evolved technology, as well as the evolved skills sets of others. Institutions were only the first stop for skills evolution. Today, important patterns for economic activity occur within flexible teams and individual matches, rather than random elements within closely held institutions. This is as true for small communities, as for any city.
Significantly, it is the new technology that calls us back to a (now) earlier form of environment and resource management paradigm - the same evolution of which the 20th century asked us to temporarily reverse course. That is, the technology of the 19th and 20th centuries needed us to subsume identity into divisions of labor that were determined outside of ourselves, when technology could only provide simpler functions of labor provision alongside us.
This is why the reclamation of our time value would be an immense leap of faith. We are quite literally being asked - as fully participating individuals - to coordinate the needs of society, the needs of ongoing production and the needs of local community at the same time, if in fact these vital tasks are going to be done at all. What's more, we need to make this responsibility an understandable part of our monetary framework. Governments have taken these tasks and gone as far with them as they possibly can. Indeed, it is a wonder they have been able to advance knowledge use to the degree that they have.
Recall the earlier time management, before specific division of labor. In this environment, by way of property holdings, we moved between value in use and value in exchange. Generally, value in exchange was the additional product separate from our time. However in today's environment, our time is the very element that has greater value than what the robot or economy of scale can contribute. Often the product (separate from time) is our value in use tool, while the value in exchange marketplace to be created is one of ideas and negotiation.
Because it is impossible to assign contrasting value to complex aspects of knowledge use, lateral time becomes the plane in which we lever arbitrage. Here, time products are decisions, check-ins, verifications, acknowledgements, assistance, encouragement, maintenance, exploration, comparison, contrast, elucidation, validation or simply hearing one another. In other words, we highly value personal time for the kinds of things most of us really don't want robots to do for us. But when no one leaves room or recognition for time value in society, social elements tend not to happen anywhere near the degree they are needed in the aggregate.
There is no denying the missing element of time value today: it can be readily seen in the growth potential of nations, as that growth potential falls away from earlier long term trajectories (aptly illustrated by Marcus Nunes). And yet, sometimes there are glimpses of hope for better outcomes, such as the recent posts on respect. In one, Bryan Caplan suggests we can grow the respect pie (I like that term). Just as Bryan saw a beneficial addition instead of zero sum, the knowledge use pie need not be zero sum, either. Instead of letting knowledge use and valued services wither away because the old methods of funding no longer work, we can put real value back into time use. By doing so, services can once again take on added dimensions, renewed purpose and social meaning.
Services wealth has the capacity to smooth business cycles, bring economic diversity back to local economies, and reorient our time use as the primary intersection for resource use of all kinds. Services and knowledge use are valued product in their own right, even if they never had the chance to be thought of in those terms. Even though our time is fixed scarcity, knowledge use has the capacity to follow an ever growing trajectory. That is, when we refuse to let knowledge diversity be shut down by institutions or economic instability.
Technology allowed us to overcome the problem of land as fixed scarcity, and that was the very definition of real progress. However, in order not to default back to land use for survival, we have to evolve skills use so that technology can continue to work for us. By returning time use to the status of a fixed economic element, we can manage and coordinate knowledge use, just as we once managed and coordinated the resources of land holdings.