My college major was in the field of economics.   And I was good at it – I can recall two of my professors who suggested that I would be a success pursuing the discipline at the post-graduate level. But at the time, I saw that going in that direction would fit me mainly for life as a college professor, and I was not interested in a lifetime of academia. 40-something years on, a cushy life as an academic economist has some appeal, but that ship sailed long ago when I chose law school and a legal career instead.

One of the things that I picked up in my education (and which became an article of faith with me) was that for all of the problems that a mostly-free market economy can cause, those things were usually fixable because the system tends towards efficiency. And it is that efficiency which creates a higher standard of living for everyone.  

One of the reasons for that efficiency was the benefit of comparative advantage – where those things are done by those who are best suited for that work. We in the U.S excel in highly advanced fields like the design of microprocessors and complex machinery, while those in, say, Bangladesh (whose labor is worth comparatively little) excel in more basic industries, like the weaving of textiles.  We will make the equipment for Lasix surgery and we can buy inexpensive clothing from Bangladesh.  This way, everyone is better off.   Or in other words, things are produced and distributed more efficiently.

Lately, I have harbored some frightening doubts about this.  Including this one: “What if the drive for efficiency, not tempered by equally important concerns, is causing more trouble than it is solving?” Put more basically, is our American economy becoming so efficient that nothing works anymore?

I am at an age where I deal with the medical system more than I used to, and it is pretty clear that our medical system has never been more efficient. Hospital systems have taken over the independent medical offices and manage all of those back-office tasks like billing and record-keeping. The doctors move swiftly from patient to patient and tasks that don’t require an M.D. get delegated to lower-level workers. And, of course, the things that modern medicine can accomplish are amazing.

But have you tried to get a question answered? Different providers require you to log into different electronic portals, and even within the same group not everyone is accessible by the online system. It takes forever to get an appointment, and anything not part of the provider’s process stream is like trying to order meatloaf at a McDonalds (where all the ingredients are there, but it is just not something they choose to offer). Except that you are not going to McClinic, but to a real doctor in a real health system.

My mother spent most of her career as a nurse, including several years at a small family practice. The medical system of 1970 wasn’t particularly efficient, but you got plenty of attention from the doc, who even went to see his patients when they were in the hospital. Go into the hospital today and your regular medical team may as well not exist. The hospital will change your medications and replace your regular caregivers with their own. It is far more efficient, but the quality of YOUR care is far inferior to the old days if you have unusual conditions or needs.

Another favorite example from my own recent life is in warehousing and distribution. The company I drive for contracts with a large manufacturing company. That manufacturer has materials trucked in from local warehouses, which it uses to turn out finished products. I have experience with at least three major distribution groups that seem to have lost the ability to pull pallets of materials from their shelves and load them into trucks. The number of times I have arrived and then waited 3, 4 and even 5 hours to get a trailer loaded is something I have lost count of.

The common thread is that each of these warehouses is woefully understaffed. But they are efficient. They are not employing people who are not working. And they are paying those workers no more than they have to, so finding and keeping workers is a problem. So the system is highly efficient, but is not really very good at doing what it is there to do.

It seems that the modern world of commerce (and even the traditional professions) is built to optimize its ability to cut costs and make money more than it is built to actually do things. The big company doesn’t pay someone to answer a telephone, but you and I have to navigate cumbersome telephone menus that eventually get us to the person we need to speak with. Although getting to speak with someone at all is also a casualty of the modern system, which saves money by contracting customer service functions (if they offer them at all) to workers half a world away who staff chat sessions. Who does not expect that even the chat people will soon be out of jobs once AI chatbots reach the ability to do 80% of the job at 0% of the cost.

The wisdom of our elders has always told us that there can be too much of a good thing. Efficiency is certainly a good thing. But not when it becomes the only thing.