Max Goolis

In the late 1950's and until the Beatles, there appeared, in the wake of McCarthyism, a pabulum form of folk music much despised by purists.  I liked it; then again, I was a decade younger than the target audience, college students.  My favorite was, and still is, the Limeliters.  One of their songs was "Max Goolis", a parody of "John Henry".  Some, I gather, found the song's very existence objectionable.  It told the tale of a race between Max (a street sweeper with a broom) and an "automatic garbage truck", a vehicle which I guess is a street sweeper.  Max ends up losing to the truck, with much humour to be heard in the lyrics and commentary along the way.

So, a race between human and machine.  It's a metaphor that's been around for at least a few hundred years.  My native New England was home to mills employing women and children in conditions about like what can now be found in China and India; although many factories in those two countries are much less lethal than what the God fearing white men of 19th century Massachusetts and New Hampshire built and ran.

Well, O'Reilly (what??? not the NY Times!!) recently had a story about the fact that Apple seems to make much more money (selling far fewer units) by segmenting its market, than do the other phone makers who engage in a "race to the bottom", as noted in the comments.  Is Apple doing a good thing?  No.  There should be a race to the bottom, if you're really a Right Wing Capitalist Smithian.

Say What??

The Right Wingnuts always trot out Adam Smith whenever they desire to increase profit at the expense of employees or the environment or any other claimant.  What they either ignore or prevaricate is that Smith was all about a race to the bottom.  Smith's thesis, boiled down, was that capital earned just enough money to keep the capital engaged.  Capital was not some superior input.  Labour was to earn its marginal value.  And markets *couldn't* be segmented or discriminated; producers had no such monopoly power.  The dirty little secret is that what Apple does is due to monopoly power.  Now, it's couched in patent terms, but that's just another reason to get rid of patents generally and software patents particularly.

The race to the bottom meme has been trotted out frequently these days, particularly with regard to HP.  The Oracle of Larry excoriates HP for dumping Hurd, while HP-ers (not for attribution, of course) are glad to see him go. Why?  Because he embraced the race to the bottom; makes lots for cheap.  In a tech company, that is always a problem, especially from a Smithian point of view.  Recall, he published the book in 1776; a fact ballyhooed by Right Wingnuts as more important than The Declaration of Independence.  Tech was pretty primitive back then, and its place in an economy not anything like what it is today.  Not to mention the elephant:  software patents are like being allowed to patent air.  Making better tech means someone, either your company or one you can buy, has to push to envelope.  In order to do that, you can't scrimp on R&D.  In order to do that, you can't win the race to the bottom.  Smith's example was pin manufacture, a variety of capital use which was settled art.  Doesn't apply now.