In this post I outline what I think David Graeber got right in his book, Bullshit Jobs.
Buy Bullshit Jobs at: Amazon | Kobo (affiliate links). You may also want to check out:
- Book Summary: Bullshit Jobs by David Graeber
- my 7 categories of (supposedly) bullshit jobs, and
- criticisms of things I think Graeber got wrong.
1. More jobs are not always good
One thing I strongly agreed with Graeber on was that having more jobs is not necessarily good thing. Even though a lot of people, including most politicians, often pretend that it is.
A large part of the reason for this belief I think stems from John Maynard Keynes, rather than from the “neoliberal” or free market schools of thought. In his book The General Theory of Employment, Interest and Money, Keynes argued that income and wealth could be increased if the government filled old bottles with banknotes and buried them, and left the private sector to dig those bottles up. This is perhaps the epitome of a bullshit job.
I have always been sceptical of Keynes’ argument. I remember when I first heard it in university, I was very confused. How could something so obviously pointless be valuable? Wouldn’t it be better for the government to give the banknotes directly to the workers so they don’t have to waste their time digging them up? I’ve discussed and debated this with friends and have turned back to ponder it many times over the years. Now I think I understand it. And I think Keynes was both right and wrong.
Keynes was right in that “income”, as measured by GDP, would increase if the government buried banknotes for businesses to dig up. This is because the GDP equation is:
Income (Y) = Consumption (C) + Investment (I) + Government Spending (G) + NX (Net Exports)
If the government gave the banknotes directly to workers, that would not show up in the above equation. This is because it would be a transfer payment and aren’t included in measurements of GDP. Whereas if the government buried the banknote, it would probably show up in the GDP equation under “government spending” and increase GDP that way.
So burying banknotes could increase GDP. It’s also arguable that a growth in GDP could increase business and consumer confidence, and lead to an increase in real investment. A businessman would look around and see the higher GDP figures and people earning money by digging up bottles. He may then decide to make an investment he wouldn’t otherwise have.
Now, even though I think I understand Keynes’ argument now, I still don’t really buy it. Keynes neglects the fact that people burying and digging up bottles are spending real time doing that. That’s time they’ll never get back. It would be much better to give those people a direct transfer (whether as a UBI, as Graeber suggests, or some other transfer), than to invent make-work for them that prevents them from doing other things. Whatever those other things may be. I think Keynes’ argument illustrates that GDP does not always measure the right things, the things we truly care about.
2. Some jobs do not provide social value
Another thing I agreed with Graeber on was that some jobs do not provide social value. Corporate lawyer was one example he frequently used. As a former corporate lawyer (albeit only for a brief stint), I tend to agree.
In the book, Graeber gave an example of a firm working on a payment protection insurance case. Since the firm was paid by the hour, they had an incentive to be inefficient in order to increase billable hours and therefore revenues. I found this was commonly true of law firms as well.
The partner I worked for in the private sector had been at a top US firm for many years. In addition to being a bully, he had incredibly inefficient work habits. For example, he would ask us to draft letters but he would always end up re-drafting them. The infuriatingly inefficient part was that he would do that by bringing us into a room and making us sit there as he amended and re-wrote the draft letter by hand. He would then make us go type up his amended draft. There would often be multiple rounds of this before a letter was finalised. He was charging us out at around $300 per hour (converted to USD), even when we were just acting as typists for him.
Now, I was not working for a law firm in the US. Our firm was one of the largest ones in my country, but most of our clients did not have the same deep pockets that clients at the top US firms did. The funny thing is, the partner ended up having to write off a lot of the time we charged clients. But he had developed his work habits in the US, and they seemed to work for him. Clients also liked it when we wrote time off on their bills because it felt like a special discount – they didn’t know how inefficient we had been in charging that time in the first place.
My partner is certainly not the only law partner to deliberately inflate hours (and therefore legal bills). One of my friends was privy to an especially egregious example during her time as a young law grad. When reviewing clients’ bills at the end of each month, her partner would outright increase the hours on certain clients’ bills if she knew that a client would readily pay it. For example, if they’d spent 18 hours working for the client that month, the partner might amend it to 20 hours! If you are thinking this is fraud, you would be correct. The partner could be disbarred or convicted of fraud if found out.
Few partners would be daring enough to do this. It’s much safer – and therefore more common – for partners to make their underlings do unnecessary work instead, like my partner did. They have plausible deniability if they are ever found out. (For the record I did encourage my friend to report that fraudulent partner but she was too afraid to. She left that firm, and the law profession, after about a year.)
Such shameful practices are not limited to just law, either. Some former employees of a large IT services company have said that the company intentionally delivered broken or fragile products. Why? Because they make most of their money from fixing it.
3. The US economy is not a true “capitalist” economy
Putting aside the question of whether law firms or IT services provide social value overall, the above examples show that at least some of their practices do not. Yet those practices still generate revenues for the companies and can therefore create and sustain bullshit jobs. Why can this happen under a “capitalist” economy?
Graeber suggests that perhaps the reason bullshit jobs exist is because the US economy is not a “true” capitalist economy. Instead, he suggests that the current system is more like the medieval feudal system.
I agree that the US economy is not a “true” capitalist economy, in that its markets are not perfectly efficient. That’s true of any economy in the real world. I think most economists – even the “neoliberal” ones – recognise that real life comes transaction costs, imperfect information, externalities and principal-agent problems. As mentioned in my note on the different types of potentially bullshit jobs, I think these problems are a big part of the reason that supposedly “bullshit” jobs can proliferate.
Using my above examples of the inefficient lawyers and IT services companies:
- Information asymmetry. If information asymmetry did not exist, clients would know how many unnecessary hours law firms had spent on their problem and would refuse to pay for those hours. If the firm could not charge for those hours, but still had to pay its employee for them, it would have an incentive to reduce the unnecessary hours worked. (This incentive is blunted slightly for salaried workers, but employees will still take into account their hours worked when negotiating pay.) Similarly, the clients of the IT services company would not be willing to pay for delivery of a broken product.
- Principal-agent problem. If the client is a big corporate, the principal-agent problem may also working to help inefficiencies persist. It may be a single employee of the client (the agent) who represents the client (the principal) in its dealings with the law firm or IT services company. The agent usually will not own much of the company. They may therefore not have much, if any, incentive to try and reduce costs for the client. Recall how above I said that most our clients did not have particularly deep pockets. We generally got more pushback on legal bills from the clients who were the actual owners of their own business. Not always, but usually.
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Have you read Bullshit Jobs? Disagree with my thoughts? Let me know in the comments below.