Guest Post by The Zman
There is an old parable about business ethics, where a young ambitious man is hired to run a pickle factory. Being ambitious, he comes up with a brilliant idea to increase productivity. He reduces the number of pickles in each jar by one. The result is the cost per jar falls and the number of jars produced goes up. His bosses are suitably impressed and he is quickly promoted. The firm hires another young hotshot to take his place, he quickly figures out the scheme and repeats the process.
The lesson of the story is that such an approach is not really about increasing efficiency or cutting costs. It is about fraud and the limits of fraud. If this process is carried out a few more times, customers will notice that the jars have a lot less product. Taken to its logic end, the company will eventually be sending empty jars to the market. Of course, once the public catches onto the fraud, the good name of the company is ruined and all of those savings they gained on the front end are lost on the back end, plus interest.
It is a useful parable when trying to understand what has happened to America over the last three decades. Free of the threat of nuclear annihilation, the ruling class has abandoned ethics and morality. One result is we live in a bandit economy, where things like shrinkflation are features rather than exceptions. This post over at Zero Hedge details how the gas you put in your car has been systematically watered down over the last quarter century, coincidentally starting at the end of the Cold War.
Of course, a trip through the supermarket will find plenty of examples of this phenomenon, some of which border on the absurd. The classic pint of ice cream is now fourteen ounces and shrinking. It won’t be long before they will quietly change the definition of quarter to be 2.5 pints. Only conspiracy theorists will notice the change. It used to be that a pint was a pound the world around, but you can’t even buy a pint of beer without a heroic capitalist pulling shenanigans on you. It’s becoming a game with them.
The libertarian line about the market simply being a place where buyers meets sellers sounds good in the hothouse, but in the real world, left unattended, it becomes a grifters alley, where the honest are preyed upon by the unscrupulous. Just as there is never a cop around when you need one, there is no longer anyone policing the practices of our capitalist overlords. If you want to know why people at the end of the Industrial Revolution were open to the call of communism, stand in the chip aisle of your market.
If you are the sort who likes a sandwich and some chips for his lunch, the one thing you can’t help but notice is the bags of chips have grown larger and more expensive. What used to be fifty cents is now a buck-fifty. The bag is also twice the old size, but inside are fewer chips than in the past. It’s already reached the point where the bag is 80% air and 20% product. If this continues on much longer, the lunch time snack will be a dirigible sent to your office containing one chip. That will be your drone delivery.
What the West is experiencing is something people figured out at the end of the industrial revolution. That is, market capitalism is great, except for the market capitalists. Left unsupervised, they quickly turn into bandits in business attire, coming up with clever ways to rob the public. Another feature of this age is the declining number of independent suppliers. It turns out that a feature of unrestrained market capitalism is the strangling of the market by a handful of powerful suppliers, who exercise hegemonic power.
Of course, what is happening here, in a million little daily transactions, is the monetization of public trust. The office workers grabbing lunch trusted that the participants at their local deli were playing fair. Meanwhile, those clever MBA-toting business men and their brilliant ideas about removing just one more pickle from the jar, are exploiting this trust and skimming a few more pennies from the unwitting customer. This sort of practice is modern coin-clipping, which used to be a capital offense.
At some point, when the rubes notice their sandwich can fit in the palm of their hand and the bag of chips is the size of a hot-air balloon, they lose their naiveté and privately realize they are being scammed. We live in a cynical age, because privately, people are coming to believe nothing is on the level and no grift is too small. That has the effect of codifying deceit as a feature of the market and of society. We are rapidly reaching a point where only a sucker trusts anyone other than his friends and family.
This is why unfettered market capitalism is a cancer on society. It turns morality on its head, justifying the unwillingness of the elite to enforce public morality. It’s why your kid’s phone is full of hardcore pornography. The market has spoken and you’re not against the market, are you? Eventually, there is the “A-HA!” moment, when people discover that their private loathing of the daily grift is shared by a large portion of the population. The preference cascade sets the world on fire and morality returns with a vengeance.
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We can’t trust certain people to behave in a certain way, so we need to make rules that certain other people will enforce against certain people so they behave in a certain way, which we all agree is the right way, until we don’t like it anymore and then come up with something else to tell other certain people about so we can change things again so that everything works better. Got it.
Because I save old plastic bottles for plant-watering, I just noticed the Tropicana juice I bought a couple years ago was 59 oz. It’s now 52. oz. That’s a huge jump: more than 13% less.
While this is so, and is an intrinsic byproduct of the capitalist system, it’s also true that net energy per capita is declining, and will continue to decline for the foreseeable future. This is naturally going to show up in all kinds of ways.
Years ago – my wife wrote a letter to Delmonte – she said they now have only 14 oz in a can of tomatoes, and recipes call for 16 oz. They actually wrote back, and told her to add 2 oz of water.
They now sell beer in 18 packs. For the same price that once was a 24 pack.
You are actually being even more sammed because in UK we have 400 gram cans of tomatoes which equates to 14.11 oz! So buy from Europe if the excange rate works for you? That actual pickle really counts doesn’t it?
I had to send a Western Union today, something I’ve done over the years so it wasn’t a first time experience. The closest one in my local grocery store had stopped offering the service so I had to drive two towns over. They no longer have the slips that you used to fill out showing sender and recipient, amount, etc. The process now begins with a special phone kiosk down at the end of the counter that looks like it was last cleaned the day it was installed. My educated guess is that since it belongs to Western Union the people who run the Rite Aid ignore it as “not their problem”.
Fine.
So I pick up the receiver and begin the tour of the first few circles of hell called “If you’d like to continue in English please press one” gauntlet. This I dutifully comply with through a series of questions about past use of the service, my phone number, if I am sending or receiving, etc. to which I input through a series of 1’s and 2’s and hashtag/asterisks/pound signs/stars/whatever nomenclature they happen to be using on any given day. This process was followed by a short debriefing on who I shouldn’t be sending funds to- much, much longer than you would have ever imagined to include paying for taxes/timeshares/in response to robo-calls/for bail/in response to telemarketing/please stop me before I am forced to repeat the entire litany from memory. Apparently Western Union considers it’s customer base too stupid to be able to determine for themselves who they should and should not be sending funds to, but in the end they wrap with a disclaimer that should your funds not arrive or should you be the victim of some scam, too bad, so sad.
By the time I got to the end of the sermon I had almost forgotten why I was even there, but the voice, so heavily computer generated it sounded like Marvin the Martian talking about frequency modulators continued to pepper me with queries. It then asked me about every transaction I had ever had in the past trying to narrow down the recipient instead of letting me tell them who it would be going to, a process that added another three or four minutes to the already protracted process. Finally I get into the ‘wait for the next available agent’ line and sat there for another three or four minutes until an exceptionally fast talking Malaysian/Tagalog/Ulan Baturian got on the phone and began to quiz me about everything I had just spent the last ten minutes divulging through a series of telephonic prompts; name, phone number, how much, who was I sending it to, who I wasn’t sending it to, etc. The speed at which she was able to speak was matched only by her inability to differentiate between any letters that sounded like any other letters; B, T, D, E, C, P are all interchangeable in the Asiatic mind. Despite my very best ability to slowly and methodically spell out each name required and to use the phonetic alphabet and her insistence on repeating back to me random words or letters in a way that indicated either a severe time lapse between where I stood in North America and where she sat in East Asia or some form of autism/Asperger’s syndrome that required speaking over me or leaving long uncomfortable pauses where I imagined the connection had been dropped. The amount of time and the limited information we exchanged could have been done in a minute, perhaps two if it had been done by the person standing behind the counter who simply regarded me with doleful eyes and a shrug every time I cast a glance in his direction. In this case it ate up another solid ten minutes at which point she read to me a nine digit “temporary confirmation code” in an equally perplexing manner, like this- “One. (thirteen second pause) twosevensixfivefive (in under one second as if she were trying to set a new speed reading record) followed by another long delay and ending with another burst of number gibberish which required me to ask her to repeat the entire number again.
With this accomplished I asked about the money part and she told me to see the man behind the counter, and unceremoniously thanked me for my business and hung up.
I gave the slip with the number written on it to the guy behind the counter and he began to go through the exact same series of stupid questions I had already been asked and answered twice during the phone call. I complied (albeit with a grimace) and when he read back to me the name of the person I was sending it to, five letters, two syllables I discovered that two of them- 40%- were incorrect. I pointed it out and he told me that I had to begin the entire process over again from the beginning.
No joke.
I won’t waste any further time trying to describe the next twenty minutes I spent on the phone with someone else who not only had a much worse accent than the first agent, but who was entirely non-conversant in phonetic spelling or even where the letter should appear- “Ees thet ‘B’ as een toom or ‘P’ as in ammoneeyah?”
Total time to send a single Western Union not including the hour round trip was close to forty five minutes. Minimum.
Every single exchange that takes place in the modern world today is an opportunity to prove that nothing is functioning as it was designed, nothing. The more complex our society becomes, the more enmeshed it is in it’s complete reliance on foreign slave labor, the more each experience and exchange is diminished and the level of frustration that accompanies it ratchets up to the point of near complete collapse.
Remind me to never have to send a Western Union.
Q: what is the alternative?
The recipient just emailed me to tell me that they wouldn’t release the funds even though they were there because there were 2 open transfers (they didn’t cancel the first one which never even went through.)
Is there no end to the madness?
paypal would taken all of 12 seconds
PayPal is out in the forefront of deplatforming anyone to the right of Bernie Sanders.
Can’t use enemy companies.
Guess it’s back to the mail on postal money orders.
When it comes to ‘modern’ technology I feel your pain, think most people do. Being a Luddite I refuse to get a smart phone which leaves me with predicaments with coupons, online access, and bill pay, etc. I’m tempted to get a rotary phone and say to hell with it except i hate ATT.
My bank was pushing Zelle money transfer on me telling me that just about everyone was using it. I have resisted that too.
paypal bullied n.carolina over gay marriage,never use the aholes–
Western Union is 3d world garbage, its customers mainly illiterate 3d worlders–of course it doesn’t work right.
‘Diversity’ wins again.
Ok, stupid, explain how shrinkflation is linked to your diversity bullshit.
This is the complaint department, what you have is a grudge. – Doc Pangloss
Man. That was painful. But I did get a kick out of the “fast talking Malaysian/Tagalog/Ulan Baturian” designation.
It’s a new world, indeed.
“Being ambitious, he comes up with a brilliant idea to increase productivity. He reduces the number of pickles in each jar by one.”
That is not an increase in productivity. In the example, the word “productivity” is being used in the context of labor output only, and even then, the number of pickles sent out did not increase.
Productivity is not just making more units regardless of what is in each unit.
A better example of productivity would be:
“Being ambitious he comes up with a brilliant idea to increase productivity. He buys a new pickle-packaging machine that doubles the number of jars filled, sealed and cased per hour at 50% of the cost of the old machine. The costs to produce the SAME jar and amount are now less. THAT is a true productivity increase – more produced with the same or less input.
“The libertarian line about the market simply being a place where buyers meet sellers sounds good in the hothouse, but in the real world, left unattended, it becomes a grifters alley…”
In the example, if the company that puts in 1 less pickle per jar does not spell this out in weight on the package (and most stores have pricing listed by piece or ounce now, right on the shelves) then it is fraud.
Libertarians are 100% against fraud because it violates the NAP (non-agression principle) because fraud is the same as theft.
Shrinking quantities and higher prices are not invisible to the customers at any time on any products available at a grocery store or retail sandwhich shop or the like that are being sold honestly and not fraudulently. Anyone can go and easily ask or lookup the real quantities and prices. The quantity/price listed on the packaging MUST match the actual content. Ingredients must also be listed so substitutes can be recognized. In a complex world, the customer needs to read and pay attention when purchasing.
I think this piece confuses monetary debauchery – government fraud by debasing the currency supply – with businesses raising prices-per-unit to cover that government instituted currency debasement.
If I use my pre-’65 silver quarters to buy things by turning them in for the Silver price in fiat currency, instead of using them at the face value price of .25$, then we can see how the currency debauchery is the true driver of “shrink-flation”. A pre-65 quarter is worth several dollars+ in silver price at the moment. So a “quarter” buys 3-4 bucks or about a gallon of gas.
Best argument for more competition. Problem is, as pointed out by the Zman, monopolies. How do we get rid of monopolies? Also, corporations were never supposed to become what they are today.
Watch “The Corporation”.
Thanks for reminding me why I fookin hate! libertarians.
I am interested in hearing your definition of Libertarian, what it is based on and where the definition comes from. From previous posts, I wonder if there is not a misunderstanding due to the distortion of language and definition that is rampant and prevents real understanding and communication.
The comments in the piece assign characteristics to the overall mindset of libertarians, such as Mises or Rothbard, that are incorrect and distorted, but might apply to what NBC, ABC and CBS would define as “libertarian”.
Most libertarians are just liberals who like to smoke a lot of weed…complete frauds.
Really? That’s your definiton of Libertarian? You think guys like Rothbard and Mises just sat around and smoked weed? That is an idiotic claim on your part and makes you sound childish and ill informed.
Have you ever read Man, Economy and State or Human Action? Can you even tell us the difference between currency and money?
People that throw out lines like, “Most Libertarians are just liberals who like to smoke a lot of weed” are small minded and incapable of forming good arguments. Hell, you didn’t even present a logical fallacy – just a completely made up claim.
But keep spouting that mainstream media definition and telling yourself you know what you are talking about.
Guess I would not make a very good crook. I would have doubled production by cutting all the pickles in half.
Seems like Tucker may be on to something, here:
Because they employ the best and brightest from our most admired indoctrination institutions?
Society doesn’t so much. Politicians do because they like to get on the public dole at premium rates.
“The libertarian line about the market simply being a place where buyers meet sellers sounds good in the hothouse, but in the real world, left unattended, it becomes a grifters alley…”
This isn’t an example of libertarianism. If it was the good products would push out the bad as buyers gravitate towards them leaving the grifters withoug customers. The reason this doesn’t happen is that the grifters have control of the mechanisms of “supervision” and erect barriers to entry to remove competition in the form of bureaucracy. Yet in spite of the problems caused by centralized control your solution is to advocate more of it.
While I appriciate the time you spent time erecting this straman I find it transparent and unconvincing.
Thank you. That is essentially what I too attempted to point out.
A couple posters above are assigning characteristics to libertarians that are the complete opposite of what libertarians and Austrians, from an econ mentality, stand for.
Lines like this are flat out lies and laughable on their face: “most libertarians are just liberals who like to smoke a lot of weed”.
No. Most libertarians are 180 degrees of “liberals” and would disagree with them on almost every issue due to an entrepreneurial mindset (that allows one to choose whether to smoke, drink, travel, discriminate, build, etc.) versus a tyrannical-communist mindset.
Libertarians promote self-direction and non-agression principle. Communists promote tyranny and violent coercion.
It is a lame attempt to defame and confuse.
The principle problem with Libertarianism is that theirs’ is an idealist’s ideal, people can never live up to that.
This is not a real argument – an “idelists ideal”…could it get more subjectively vague?
Are you saying your claim is that people can never “live up to” self-direction and non-aggression principle even though that is what amost everyone – outside of political office and criminals – is doing every day? Those are the two main and most important tenets of Libertarians. I think you are going by the false definition you probably heard via MSM News.
The principle problem with Communists/Progressives is that theirs’ is a coercion-based Tyrannical ideal and people are sick of that crap.
there’s a reason that just weights & measures is mentioned in the bible–
I think a distinction should be make between mercantilism and the free market. Corporations are a fiction entity created by the state. The are actually a form of and a precursor to communism. Communism is the separation of ownership from control and responsibility. This has been said for 80 years now. Mercantilism is the manipulation of the State by corporation. This corruption arises from the separation of control from accountability. When your neighbor owns the deli, he is much less likely to rob you. He will be in your bakery tomorrow. When ownership is separated from control and distributed far and wide, and when control is exercised from hundreds of miles away, the owners and the managers don’t have to look you in the eye every day.
I agree with your insights regarding responsibility, but would point out that the definition of Mercantilism is not “the manipulation of the State by corporations”. It is the manipulation of business/trade by the State.
States themselves practice Mercantilism right now. Like China.
In a nutshell, it means: You buy way more from me, than I ever buy from you…so, you pay me way more, than I ever pay you. It is a wealth transfer mechanisim.
Wikipedia:
Mercantilism is a national economic policy that is designed to maximize the exports of a nation…
Britannica:
Mercantilism is an economic practice by which governments used their economies to augment state power at the expense of other countries. Governments sought to ensure that exports exceeded imports and to accumulate wealth in the form of bullion (mostly gold and silver).
There are many more with the same definition in similar language.
Anglo Saxon culture produced high trust societies for the last couple of centuries. Mix the unfettered greed of current globalist corporate practices with the inundation of the first world with tens of millions of tribal third world people from traditional low trust societies and we have a recipe for disaster. Agree that the US is finished as a political, social and cultural construction.
“The bag is also twice the old size, but inside are fewer chips than in the past.”
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