One of the primary topics of debate that has arisen in recent months is the general goal of modern macroeconomics and society as a whole.  The so-called “holy grail” of modern macro is full employment and price stability.  This is convenient because the figures are relatively easy to quantify and they allow economists to build models that are not excessively complex – kind of like plug and play.  And in this case, we’re plugging in numbers and often concluding “abracadabra, we have full employment and price stability if we do X, Y and Z!”   Of course, the world is not so simple and this dismal science often turns out to be awful science or not even anything closely resembling science.

I wonder if, at times, in focusing solely on these admirable goals we are in fact losing sight of the real goal.  The reason why any society forms in the first place is because we have a collective understanding that we can achieve a better overall living standard if we leverage one another’s strengths and abilities.  I have argued that human beings are the ultimate pack animals even though we like to think of ourselves as rugged individualists.  This basic innate understanding is what drives us to need one another and understand that we are better off in groups than we are alone.

Our monetary system is simply an evolution of this understanding from spoken bonds (and even unspoken bonds) to written bonds.  But the goal of a society has not changed despite the fact that the tools we use have changed.  The end game has always been the same.  It is the desire to generate improving living standards through the efficient use of resources resulting in the optimization of time.   The element of time, in my opinion, is the key piece of this puzzle.  The true holy grail of modern macro is not price stability or full employment.  It is time.  Time is the ultimate form of wealth in a modern society.  It is through time that we are able to live fuller and more meaningful lives.  What you do with your time is up to you.  But the key is that having more time means being able to do more of what you want to do. In theory, we can consume and produce an infinite amount given the time.  But time, as we all know, is not infinite for finite creatures.

I have been kicking around what I have been privately been referring to as the “MMR Law”:

“We generate improving living standards through the efficient use of resources resulting in the optimization of time

This is a powerful concept and one that can change the way modern societies approach economics, public policy and every day life.  When one understands that time is the ultimate form of wealth their perspective is dramatically altered and the playing field is changed.   And while full employment and price stability are admirable goals, they become secondary to this understanding which sits above them in the hierarchy of societal goals.



Got a comment or question about this post? Feel free to use the Ask Cullen section, leave a comment in the forum or send me a message on Twitter.

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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  • Ben Wolf

    @Cullen Roche

    It seems to me there are three fundamental ways in which the operational realities of MMT can be harnessed to increase demand, productivity and long-term growth while countering economic downturns:

    1) Give everyone a job

    2) Large organized spending programs

    3) Hand money directly to consumers to do with as they will

    All of the above are forms of buffer stocks and #1 has obviously been rejected by MMR advocates. Of the remaining two, which is more likely to support improved quality of life in a manner which minimizes mal-investment and other negative feedbacks? Which most closely approximates the macro-economic program you’d recommend?

  • Dimm

    I thought “there is no such thing as society”. At least according to some. That is what the discussion is all about.

    Here is Margaret Thatcher, Women’s Own magazine, October 31 1987

    “I think we’ve been through a period where too many people have been given to understand that if they have a problem, it’s the government’s job to cope with it. ‘I have a problem, I’ll get a grant.’ ‘I’m homeless, the government must house me.’ They’re casting their problem on society. And, you know, there is no such thing as society. There are individual men and women, and there are families. And no government can do anything except through people, and people must look to themselves first. It’s our duty to look after ourselves and then, also to look after our neighbour. People have got the entitlements too much in mind, without the obligations. There’s no such thing as entitlement, unless someone has first met an obligation.”

  • FDO15

    Awesome post Cullen.

  • jswede

    “2) Large organized spending programs”

    CORRECT: Large organized tax cuts.

  • Huckleberry

    Sorry, but I don’t see any of this. There is nothing simple or evolutionary about the rise of our monetary system. A rationalized economic end game has rarely been the goal of human activity. You are projecting a contemporary pseudo-scientific statement of faith back through history. This seems to me like trying slam Neanderthals into a class struggle.

    With no respect to Thatcher: there is such a thing as society, although finance capital has done an excellent job of shredding it. It is this modern notion of atomized individuals that underlies many of our troubles. I would argue that it in fact turns out that No Man is an Island, and “individual” fulfillment is almost always a chimera. This atomized view of man is the shadow cast by Hobbes, Locke, Marx, et al.

  • Obsvr-1

    Wow, adding another vector to the discussion, this certainly can/will open up a pandora’s box of discussion and debate.

    If time is the precious commodity that one strives for, then what about all the crimes of stealing someones time and what should the punishment be for such a crime against humanity.

    Example: To achieve the societal goal of optimizing time for all, is it more important to lock up a casual marijuana user (victimless crime) or a fraudulent moneychanger (rentier) who impacts many/masses in their ability to achieve quality of or optimization of time.

    A lot of room for intellectual pondering …

  • http://www.pragcap.com Cullen Roche

    I guess that’s true if we all live on Crusoe Islands! :-)

  • http://www.pragcap.com Cullen Roche

    2 & 3 would obviously be my ideal choices. Cut the fat and target our true goal which is production. The more I think about it, the more I think my innovation initiative should be the centerpiece of public policy. We know we can’t run out of money. And we know that we have this govt that can be utilized as a partner of ours for public purpose. So why wouldn’t we leverage the strengths of our society to innovate and make real investments in our futures?

  • jaymaster

    “We generate improving living standards through the efficient use of resources resulting in the optimization of time“

    That’s a very good start. As an engineer/businessman/investor, that statement could very well be the motto for my life. But I know that there are other folks who just don’t see things that way.

    I don’t see how you/we can resolve some of this stuff without veering into religion, or philosophy. I.E. BIG questions.

    What if I don’t want to improve living standards, for me or anyone else? Such people certainly exist. Amish come immediately to my mind.

    What if I just want to be left alone, mind my own business, smoke a doob, and stay out of society?

    And what exactly is “society” versus “government”? Who gets to make these decisions anyway?

    I see some of this playing out in Europe right now.

    Sorry if I’m going off the rails here. But this is where I see some of this stuff going.

  • Alberto

    CR you posted these arguments a lot of times. I’ve no counter arguments except one. All your proposals (and MMT or MMR in general) are totally incompatible with the current environment dominated by almost omnipotent private cartels (in finance, energy, health care…) If you create money in such an environment most of that money will flow in speculative finance and the biggest effect will be a continous growth of prices in oil, copper etc… So frankly speaking it’s time to tell something about how to change the political and economical environment (and if the dow goes to 400 is a price worth to be payed) otherwise everything else is worthless.

    “The liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than the democratic state itself. That in its essence is fascism: ownership of government by an individual, by a group, or any controlling private power.” 

    Franklin D. Roosevelt

  • Paul Krueger

    I want to nominate another factor for your list of goals: fairness. People will put up with all sorts of hardships and inequality of outcomes if it is believed that they were a result of a process that was fair. And they will oppose policies that they perceive to be unfair, even if they could lead to a general improvement of conditions for everyone. My contention is that most of our political wrangling today has to do with two fundamentally different (bordering on religious) views about what is fair. You can find examples of these types of arguments from both the left and the right.

    Optimizing for your other goals while convincing everyone that the process is fair is the real trick.

  • http://www.pragcap.com Cullen Roche

    Obviously, these are big questions and we’ll confront them for the rest of time. And since time is running out, we better agree on them quick. :-)

  • jaymaster

    I was thinking recently that from a time return perspective, a totally awesome investment would be slaves. Buy (or capture) a good bunch of them, and you’re set with tons of free time.

    And for thousands of years of human existence, this was a perfectly valid option.
    But eventually societies and/or governments decided that just wasn’t very nice….

    So I guess that’s an example of something other than “economics” coming into play.

  • freemarketeer

    The goal of modern macroeconomics should be to explain modern macroeconomics. The goal of a society depends on that society.

    Maybe it speaks to your opinion of welfare benefits, but why not just make “unemployment benefits” into “Lost you job? Do this work for some money until you find something better.”

    #2 is my favorite answer, but I don’t see why we can’t pay people to do some work. Maintain a database of enrollees with temp agencies or something who can expedite the return to the private sector. Get a little cash flow and a reference.

  • http://www.pragcap.com Cullen Roche

    Slaves were all about economics and production. Obviously, we are humane creatures so we should not only seek to become better, but more virtuous. That’s in large part why laws and rules exist to guide the system we’ve built….

  • Obsvr-1

    Slavery – Exactly where the lower and middle class are held, slavery to the creditors. Work all day, some day/night, multiple jobs without any hope of getting ahead in the game, never get to the point of “owning” others time. All within the elusion of freedom — everyday the plutocracy and financial elites continue to winnow the true freedom away, while the masses are distracted by the main stream media, entertainment industry, political theater.

    When the straw finally breaks the back of the masses then ‘revolutionary’ changes will ensue, the real question is how much “straw” will the masses continue to carry.

  • Anonymous

    Good start, but the greatest complexity comes in the distrution of costs and benefits. Maximizing the average can lead to some perverse outcomes.

  • jaymaster

    Exactly. See my (tongue in cheek) comment about slavery above.

    But then we have questions like, who decides what “fair” is? And how do you put a number on it to plug into an economic equation?

    Some folks like to use the income inequality number, but that seems like complete rubbish to me. Some folks I know are perfectly content to make a pittance, while others love busting their butts to hit 6 or 7 figures or whatever.

    So it seems to me something like “the pursuit of happiness” needs to factor in somewhere.

  • http://www.pragcap.com Cullen Roche

    Modern macro only exists because society exists. Trying to separate the two is pointless. MMTers try to do this all the time – “MMT is not a theory of the state, it is a theory of state money” or something like that. It’s called obfuscation.

  • dgc

    It is the desire to generate improving living standards through the efficient use of resources resulting in the optimization of productivity.

  • http://www.pragcap.com Cullen Roche

    I would argue that you can bunch efficient use of resources into optimization of productivity….The key is the result if an optimization of time….No?

  • dgc

    You can argue that “time is the ultimate form of wealth;” I could argue that the optimatization of productivity is the ultimate source of wealth.

  • http://www.pragcap.com Cullen Roche

    I don’t think we’d be disagreeing then! Much of the reason why I started MMR is because I want to optimize potential production! My point, that I didn’t exactly tie into this post, is that it’s primarily through increases in productivity that we create more time. So it’s all interconnected. It’s a really powerful concept when you connect the dots.

  • Balinvadasz

    Do you consider this theory for 3rd world countries as well? I would argue that there seems to be a “phase transition” in the way societal goals work as you move from “my sole concern is survival of myself and my family by whatever means necessary” (people in 3rd world countries) to “how can I live the life I want” (people in advanced economies). Your idea seems valid for the second state, but is probably meaningless in the first.

    There, people have seemingly “infinite” time because their planning horizon is very short and they have very limited resources so they try to convert their (and their families’s) time to resources they need to survive. Once the society reaches a given point of wealthiness survival is more-or-less guaranteed so the priorities shift to maximizing the value of – the now seemingly more limited – time.

  • Paul Krueger

    I’m inclined to say that “fair” is whatever we can get a majority to vote for (or maybe we need a super-majority in the senate). But with that definition the cynic in me fears that maybe fairness is beyond reach and even the optimist in me thinks that any significant policy recommendation will require a major public relations campaign directed narrowly at each of the specific charges of unfairness that will be raised against it.

    I’ve been struggling to construct a more precise definition of fairness that could be more widely shared. I’m finding that to be more difficult than I imagined because it needs to include both the notion of getting what is deserved by virtue of effort and aptitude, and equitably sharing the benefits derived simply by virtue of being a member of a collective society. The latter is particularly challenging because it is a moving target. As we become collectively more wealthy it makes sense to provide an ever higher base-level standard of living, but how the heck do you do that equitably? We’ve actually done both of these things pretty well in the U.S., I think, but I’m sure there are people who will argue that either of these has overly benefited to the detriment of the other. In fact I think that’s exactly what defines the bulk of our political differences.

  • http://www.pragcap.com Cullen Roche

    I think that’s a fair statement. But even in this sense, the need just to survive is all about time, right? If you run out of time, you’re dead, right?

  • tradeking13

    Looks like Iceland got it right.

    Icelandic Anger Brings Debt Forgiveness in Best Recovery Story (Bloomberg)

  • jaymaster

    “As we become collectively more wealthy it makes sense to provide an ever higher base-level standard of living, but how the heck do you do that equitably? We’ve actually done both of these things pretty well in the U.S., I think, but I’m sure there are people who will argue that either of these has overly benefited to the detriment of the other. In fact I think that’s exactly what defines the bulk of our political differences.”

    Amen to that!

    That seems to be at the root of the European mess right now to. The political elites versus the citizens. The Greeks versus the Germans. Lazy Southerners versus cold hearted northerners. The bankers versus everybody.

    Take a step back, and in the big picture, the Union benefited all of those groups. But now that there is pain, each group can look at some aspect of the attempted resolution and say, “Hey, I’m getting screwed here!” Well, except for the bankers, of course….

  • ES

    Maslow’s hierarchy of needs is well known. Obviously, Cullen talking about the latest stage when he talks about free time – self-actualization, while 90% of the wolrd still exists in the first stage of being able to provide for their own survival needs.
    I would say US society passed 1st (survival) and still working on the 2nd (safety). Europeans are in the 3rd stage.
    In the ideal world we’d all be free of such worries as survival and safety but we are very far from it. I am still working on”safety” in terms of being able to finance my eventual retirement and my kids college education.

    If we look at the current capitalist system , which is accepted as the best humanity was able to come up so far, it appears its goals are around safety – ability to earn and preserve the wealth, which then is used to ensure survival and safety of the family and bloodline. But inherent in the capitalist structure is the darwinian approach where people who are incompetent or not as skilled or gifted have their survival and safety at risk and therefore society itself cannot move any further in the hierarchy. Capitalist society seems to encourage greed above all because of its inherent lack of security ( a single serious illness could bankrupt entrie family), which is taking us even further from egalitarian and fair society we are all dreaming of.

  • Dennis

    I don’t think “time” is the correct term: “running out of time” or “optimizing time”. Since I once studied quantum mechanics, time is only relative… where does it go, where is it coming from? “Productivity” doesn’t add much. I’m retired now and by any way of measuring things, my “productivity” is near zero and my “time” is…well, I don’t use or have a watch anymore. So I think the “resulting …” part is actually redundant.

    “We generate improving living standards through the efficient use of resources resulting in the optimization of time“

    “We seek to generate improving living standards through the efficient use of resources”

  • WolfePaq

    so it would seem the Amish have it right- it is modern society itself, with all it’s time saving conveniences, that we have less time than our forefathers. Unless, as intmated by a poster above regarding third world/1st world differences, you are a GS master of the universe with virtually unlimited capital to buy all the serfs/slaves/indenture servants/support staff to enjoy free time with all of your food, clothing, shelter and travel provided by others. It is interdependance that makes us weak, not strong- ie dependance on foreign oil, cheap labor and polluting factories in china to provide cheap goods that put our fellow American out of work by global labor arbitrage. If we are independent, we are strong…

  • I’llHaveADouble

    “We generate improving living standards through the efficient use of resources resulting in the optimization of time“

    I don’t mean to be a turd in the punch bowl, but maybe “…optimized use of time”? It’s not making time itself better, after all.

    Good stuff. I like it. One of the many factoids brought together in this piece is that we spend more time stuck in traffic than the Europeans.


    Not optimizing.

  • Dennis

    Speaking of wasting time…I just got my final draft filled-in tax form e-mailed to me out here in Maui. My accountant and I have wasted so much time, energy and moola on this darn thing it’s ridiculous. If I hadn’t gotten irreversibly signed up with a broker and instead invested my moola in just a few of my favorite companies/e.g. under my mattress, I would have a LOT better living standard at this particular point in time.

  • http://www.pragcap.com Cullen Roche

    Aren’t we though? We are making better use of our time here. People 100 years ago did not live much longer than they do today, but we are able to utilize our time so much better. In essence, our time here has been better optimized.

  • boatman
  • Explorer

    “In theory, we can consume and produce an infinite amount given the time.”

    Anyone arguing a position from this basis must end up with a false conclusion.

    We operate in a world of scarcity and increasing scarcity at a given price and increasing scarcity in absolute terms at least on a country by country basis and, I believe, globally.

    Peak Oil is probably coming globally if not already here, it has definitely occurred in a number of countries, and the monetary and energy costs of extraction are clearly increasing (tar sands, deep water drilling, arctic) as are the likely environmental costs.

  • Explorer

    Time is not the ultimate form of wealth.

    An old person will likely tell you it is health, or family.

    The unemployed who have lost their homes will tell you they would willingly give up 40 hours a week to get back their houses and not have suffered the family stresses of long term unemployment.

    If the ultimate form of wealth were time everyone in a full time job would take 3 weeks extra holiday without pay soon to increase their wealth and distribute some employment to the “wealthy” unemployed.

    The ultimate form of wealth is a balance of self esteem, monetary security through income and assets, health, social relationships. True wealth is a balance thing.

  • http://www.pragcap.com Cullen Roche

    So the oil goes away and we consume something else. I am not saying that we won’t consume certain things away….

  • http://www.pragcap.com Cullen Roche

    Sure, you can cherry pick any example to prove this wrong. But for most of us, time matters more than just about anything else. Whether you think about it often or not….It’s the one universal that effects all of us all the time.

  • quark

    Do we really use our time more efficiently? I suppose we do if you are a technocrat. If you allow yourself the convenient dilusion that exists in a complacent state of technical advancement while ravaging tranquility….oh, yes the state of tranquility in todays quality of living index has as one of its measured data points as synthetic neurochemicals whose efficacy is relieving the increased tranquility of a higher standard of living.

    While we may have increased our ability to more efficiently kill, steal and heal we have not developed the ability to move beyond discovering the present. Capitalism is but a hairs length above communism where iving in the past doesn’t requier change, we are still unable to comprehend future potential unless it is hurled down the pipe in Switzerland. We kill one another over a finite energy source when we daily bathe in an nearly infinite energy source.

    If photons were easily harnessed as an energy source perhaps we would stop killing innocent men, women and children for the right to consume oil. This is what I mean by comprehension…or better said our inablity to comprehend that we as a “modern” society CHOSE to kill innocent men, women and childrenn because we live in a world of cognitive dissonance, a world where the reptilian brain leverages fear to suspend reason. We feel more for a child falling off a bicycle than a missile that kills hundreds of children.

    Modern society…pathetic…based on our inability to see we are still dragging our knuckles in the mud.

  • Dennis

    Hello CR, “The optimization of time”, you must have escaped into some other realm controlled by string theory, or you’re just in a big big hurry and in serious need of a “time out”. Thanks for using up some of your valuable time to write this up, but…maybe you need to take some “time” and think about this stuff? I just now took my “time” with a bottle of XX.

  • jaymaster

    I have to agree with that. I am a book geek, with 6-8 thousand books in my library. But I doubt I’ll ever hit 10,000 now.

    I used to spend weeks in libraries and used book stores tracking down extremely nichey books. Now, I can find most of them (or the location of them, at least) in minutes on the internet. That is powerful stuff.

  • jaymaster

    “We operate in a world of increasing scarcity”.

    Sorry, but that is mostly wrong.

    Every year, we learn how to produce more grain per acre, more meat per hog or cow or chicken, more oil and gas per well, more copper or iron or gold per ounce of ore.

    Or in more modern terms, how to cram more information into existing bandwidth, more life out of batteries, more miles per gallon, more music, more videos, and more books for ever lower prices, and even longer life out of a pair of underwear. With more styles available along the way.

    Scarcity? Maybe in a few areas. But I’m seeing that most of the world trying to figure out how to deal with over production right now.

  • belegoster

    It may be useful to ground these concepts with actual physical definitions.

    Increase in time= positive rate of return on work invested

    Work= electro-mechanical work (measured in joules)

    The increase in time via productivity gains can hence be characterized as any enterprise which increases future work capacity for the amount of energy consumed. This is a fuss-free, philosophy-free definition that can be empirically measured. It is easy to conceptualize any economic enterprise this way. E.g. healthcare: vaccination research=good (frees up productive young labour), cancer research=bad (zombie proliferation).

    This is also why the base of any national economy should be manufacturing and not finance.

    Provenance of ideas courtesy of Eddie Devere, who designs power plants for a living

  • BT

    “Our standard of living is lower, but our quality of life is much higher.”

    A person who moved from South Africa, where they lived in a mansion and had servants, to Australia, where they had a smaller house no servants.

    Living standards may be an economic goal, but they are definitely not ‘the true goal of a modern society’, which must also incorporate political goals.

  • Leverage

    No it’s not, only if you use a percentage of USA as basis of your analysis. Not if you use the whole USA, even less if you use the whole world.

    How can people be talking about this when there still are billions which do not met basic food needs to have a health development during childhood. Off course this only can work in “infinite class decouple from the world/nation” scenario, which is not the reality for most people (which had diminishing purchasing power and spare consuming capacity for a decade).

    As the wealth share of each nation diminishes because the increasing production of certain goods and commodities is insufficient to met global demand without rising prices time becomes less of a problem and meeting needs becomes a bigger problem for a, in other time, wealthy population. But most of the humanity is in the phase of covering basic needs and creating a safe environment yet, so.

    Off course if you look the world through a certain biased prisms you will come with false dilemmas.

  • Leverage

    Only true partially (not for everything), at the expense of more energy (which in the end makes costs raise), and with diminishing returns. The share of income spent directly (ie. gasoline) and indirectly (every consumed good in our current industrial model has included a lot of oil-derived costs) on oil has been increasing for a while and will continue so.

    The higher costs are translated to sustained inflation (we barely had any deflation) of plenty of goods (specially basic stuff) while stagnation of income. Ultimately this will trigger disinflation and deflation when limits are reached (and then repeat the cycle again, we already had one despite CB’s).

    And off course, if it was as easy as ‘we will consume other thing’ as CR says it would be done already. A ten for financial stuff, but zero for real production and consumption, technology etc. which does not work that way.

  • Sergio

    Man is not an island and no one man is a society either, and no society is trying to accomplish some joint goal…..you just think they are. The lie may become a reality if you repeat it long enough but it may not be a good reality. Time is money ….. we have nothing to sell but time. One mans junk is another mans treasure. Time and society and production, debt and money and on and on …..are always realitive to the idividual.
    I was semi-retired at age 35. Because time was the most valuable thing for me. It wasn’t just ROI but ROT and it was about margin…. and it was realitive because I am not, nore have I ever been a millionaire. But what I did do is make sure I have no debt, that in my opinion is time slavery. Unless you like what your doing. After all we do trade our time for money. With all the time I have the only thing that I like to do is work at something meaningful and make money so I can spend it. To me giving people money or time is useless if it brings no value to them. We are all a little different and time, money and opinions are realitive.
    My other two cents ( inflation ? )….debt and consumtion my have advanced society and brought many good things to many people. But you still don’t know what you don’t know. It doesn’t matter. What matters is how you feel about your here and now and what works for you….what brings you value… what makes you feel good. It’s more important for me to be happy than it is for me to be right. (They) aren’t making any more time for me….after today is gone I can’t relive it. But the vaule of time is realitive to the idividual. So is productivity….because the people living in 1950 are no less valuable today then they were back then. I could live just as happy being unproductive back then as I can right now. If we only advanced in 2012 to a 1950 life style and production wise it wouldn’t make a difference. Because in the end we are all going to end up the same way (dead). The value of time, production, debt and money are all realitive…. not to societies view but to our view in our present life…right here right now. You can’t live tomorrow today no matter how productive you are. No matter how much free time society can give you the value will always be realive to you. Its not about quanity its about quality ( In my opinion ). In my life less is more and you will do what ever you (think) brings you value….untill you think different. Society has an affect on the individual and the individual has and affect on society. The affect or the effect is realitive…..you’ll live until you die. Society in my opinion is not trying to creat some meaningful accomplishment (as a whole ). The individual is doing what he is doing and it may appear collective. If that is how you choose to view it.
    Remember when all is said and done…. more is said than done. HA, I have to quit talking now and go do something productive. ( In who’s opinion? )

    Good Luck To You All

  • Gary_UK

    The MMR law according to Cullen Roche. What wonders having one’s own blog can produce! Perhaps next the 10 commandments of MMR? Or the President of MMR maybe?

    Time is of course valuable, and I am sure the 45 million on food stamps thank their lucky stars (perhaps whilst singing Kumbaya?) for all the time they have on their hands.

    Yeah, reality bites baby, coming soon to a campfire near you!

  • boatman

    roger sergio…….debt is the currency of slavery.

  • jt26

    Time is right, but the group/competitive/human psychology problems remains in any macroeconomic/social theory:
    – some people’s time is more important than others; what some people can do in a given period varies with persons
    – some people will always minimize their own time spent on X at the expense of others if they can get away with it
    (re: the last 2 points: everyone should have learned this from university dorms and study groups!)
    – how people view the value of their own time is not constant and highly nonlinear
    – energy+machines affects the value of time

  • http://www.estimatedfuture.com Estimated Future

    What you’re talking about here is broader than economics. I have seen abundance of resources without abundance of time. It is not true wealth.

    Having more time to do what you want to do, be who you want to be, see who you want to see, and create what you want to create is the ultimate goal. Money is just paper. (Or, as you might say, Something to pay your taxes with.)

    You’re on to something big here. Something it’s amazing more people aren’t talking about or haven’t been talking about.

    It also makes me think of a quote that’s not quite on topic:
    “Human beings are not by nature kings, or lords, or courtiers, or rich. All are born naked and poor; all are subject to the miseries of life, to sorrows, ills, needs and pains of every kind. Finally, all are condemned to death… It is the weakness of the human being that makes us sociable; it is our common miseries that turn our hearts to humanity; we would owe humanity nothing if we were not human. Every attachment is a sign of insufficiency. If each of us had no need of others, he would hardly think of uniting himself with them. Thus from our weakness our fragile happiness is born… I do not conceive of how someone who needs nothing can love anything. I do not conceive how someone who loves nothing can be happy.”

    Rousseau, EMILE, Book IV

  • Kobayachi

    Slaves! Thank god we passed on to something better.
    First off, a slave was very expensive in the US in the 17 hundreds; they would be almost unaffordable today. Then, you have to take care of your means of production, like with any production tool. You have to feed them, provide shelter and sanitation. All this is far too expensive, unless you make them work 12 hours a day like some poor Chinese guys at Foxcom. But hey, we’re much more sophisticated in the western world. Why would anybody make a long term investment in a slave when you can just rent one?
    You just pay them minimum wage and they have to look for food and shelter themselves. Much better, I tell you, Sir!

    Btw, what you’re describing Cullen sounds an awful lot like communism. Just saying…

  • Wantingtoretire

    This is really heavy stuff. Societies are about people not money. People are about survival. That is their number 1 driving force. That’s what every animal pursues. Some people have developed complex societies while at the same time there are many simple societies still in existence. It is not a one size fits all program. American “society” is one kind of society. To presume that all societies want to or will follow one goal that is valued above all else is presumptuous.

  • Timmer

    Cullen said:
    “The element of time, in my opinion, is the key piece of this puzzle.”

    Every time I walk away from my car and lock the door with the key fob I think of how much time this innovation saves me. I forgot to lock the car yesterday until I was a hundred feet away from it. The range is amazing. Maybe it saves a few seconds a day. Maybe more. It adds up in a year. If I had a near field device in my watch I would never even have to spend the time to think about locking the car. That would be worth something.

    This simple innovation saves how much time for everyone in the country each day?

    Some will use it like money to invest in something else of greater value. Others will waste it. Either way it will be spent.

    I used the time saved to do an extra lap in the club pool.

    Washing machines did more than clean clothes. Women could do more cooking. More thinking about washing and cooking….

  • Timmer

    Time in buys time out

    I spent 22 years in the navy. Retired in 1983. I have not worked for pay since then. I have been out of the navy longer than I was in. Time in bought time out with security and the means to do anything with that time that I chose to do.

  • I’llHaveADouble

    Oh, totally – no quarrel. The trajectory is wonderful. It’s our obvious shortcomings that are maddening.

  • JohnfrmCleveland

    Over this past year I’ve been in a few debates about the maximization of production, stemming from the MMT precept of the government putting unused resources to work with deficit spending. I figured the most efficient way to do this was by the government directly hiring the unemployed to do, essentially, busywork. (No sense in govt. jobs competing with the private sector, right?)

    One thought I kept coming back to was this: we, as a country, are way more productive than we really need to be. We produce, I think, around $50,000 per American ($15 trillion GDP/300 million people). Increases in productivity mean that fewer people are needed to produce all that we can consume. Our problem is distribution. For a number of reasons, way too much of our economic gains are being captured by the superrich. And it’s only going to get worse in the future – the trend is more production from less labor, and there is no reason to think that will change.

    This is why I believe the answer to maximizing our standard of living is going to come from the government, not the private sector. The private sector has no mechanism for sharing the wealth once the demand for labor declines so much.

    The government, on the other hand, can tax and redistribute as its populace sees fit. These days, when unemployment is still manageable, we can fill the gap with government busywork jobs. But someday in the Star Trek future, when maybe 20% of the workforce produces more than we can reasonably consume, government distribution of income is going to have to be the rule. We can’t continuously increase production ad infinitum.

  • Dennis

    RIght now we do have a certain amount of “busy work” being paid for by Uncle Sam and the States, namely welfare, food stamps, a bit of Infrastructure building, grants for teachers and researchers, and of course prisons. All of these “programs” could productively use more of Uncle Sam’s dollars and hire a lot more folks from the unemployment rolls. (On the last point, there were over 7 million adults were under correctional supervision (probation, parole, jail, or prison) in 2009 — about 3.1% of adults in the U.S. resident population. Approximately 500,000 youth are brought to detention centers in a given year. (For sources see wikipedia). Uncle Sam could hire more people to take care of these folks and help the “good ones” get out and stay out, and put a lot more “bad ones” in prisons. We could have 5% of our population doing “busy work” just in the corrections business.)

  • Johnny Evers

    The optimization of time can lead to more production and provide individuals with more leisure time, but time of itself is not the goal of any individual or society.
    Most individuals value family, health and a feeling of being useful to them selves and the people important to them.
    People today have more free time — largely as a result of technological innovations and because they can produce more in a shorter period — but the family structures are breaking down, especially among the poor, and they spend their time on television.
    Mr. Wolf’s suggestion is pure communism. It’s not the government’s job to provide work and give money to people (where does this money come from? Oh, wait, I forgot, you print it).
    It’s the government’s job to preserve the conditions that we agree allow people to pursue their own goals.
    It is counter intutitive, I know, but only by being free to pursue our own salvation can we build a cohesive society. It has to be a bottom-up approach and not a top-down approach.
    And what Thatcher meant is that government is *not* society. Government exists to serve society, not to dictate what we do.

  • MS

    Love the discussion. Things to think about Cullen.

    1. Mentioned earlier, Maslow’s Heirarchy of Needs (really relevant here)

    2. Read the book the “Progress Paradox” by Gregg Easterbrook.


    3. So is the “robot economy” really what we should be after? It’s an imaginary state where robots do everything and make everything for people, so that we can spend 24 hours a day doing anything we want. Reading, praying, playing, etc, you name it. In my experience, most people just cause trouble when they have too much time on their hands.

    4. People run on incentives. End of story. Either there is a carrot or a stick pushing or pulling us through the moments of our lives, we are not after more control of our time, if we were, most of us would have quit our jobs long ago.

    5. What are we after then….? Nothing really, we are just programmed to be competitive with one another, gene pool stuff probably.

    Great discussion though.