Tuesday, March 02, 2010

The Economic "Fail" of the Century

As some of you are aware, the price of oil has become somewhat pricey in recent months. It's now around $100 and we get to pay approaching $4 a gallon in gas.

Accusations will be made. Big oil will be blamed. Investigations launched. But in the end it is the unstoppable forces of economics and the declining currency of a declining nation that will win in the end of the day and you will continue to have to pay $4 a gallon in gas...maybe $5 or $6 when summer rolls around.

Now we can blame the turmoil in the middle east (correctly) for the increase in prices. You can blame the declining dollar (correctly) for the increase in prices as well. And yes, I will even allow those on the unthinking and galactically ignorant left to go to their knee-jerk position of blaming "big oil" (incorrectly) for the increase in prices. But it will all be for naught because the debate is moot. There is no reason to argue about oil. And I shall explain why with some more of my super awesome economic genius.

IN REALITY (and I say this with all seriousness) gas should be trading at about 40 cents a gallon. And if I were president and had both houses of congress it would be at 40 cents a gallon. It would trade at 40 cents a gallon NOT because we would enact price controls, but the MARKET rate would be 40 cents a gallon.

Now, would this be because I would drill baby drill?


Would this be because I would invade the middle east for their oil recreating an oil-rich empire?


Would it be because I would subsidize alternative fuels to the point gas would have to be 40 cents a gallon?


It would be because I would gather up all the business "leaders" in the US and we'd get them into a little room and I would ask them one simple question;

"Why in frick's name are you requiring people to commute to work when today's technology makes it pointless?"

I have brought up this point before, but at the time I was not a student of computer networks or IT like I am today, and was informed that for security reasons, among other reasons, businesses do not like it when people work from home. But after a year of studying computer networking I am here to inform you that it is not only technologically possible, it is no riskier (bar human behavior) to have people working remotely. Telecommuting from your home is no riskier (with the appropriate measures taken) than working at an office, if for any other reason, you are technically still telecommuting while in the office, using the exact same routers and servers.

Of course, the question is "why don't we telecommute then?" and this is the largest most gigantic economic fail the US has ever made.

In short we passed up on the latest economic revolution because we are no longer American and no longer dare to dream.

If you look through history there have been various economic "revolutions" that have advanced and improved humans' lives greatly.

The agrarian revolution basically wiped out hunger.

The industrial revolution brought us electricity, transport and limitless goods and services making out lives that much easier.

The technology or "information" revolution made communications immediate.

And a by-product of the revolution allowed for the next great economic revolution, the "telecommuting revolution."

The only problem is, nobody in the US cared to avail themselves of it.

Oh, India certainly has, taking significant business from the US' IT sector. So has China and Ireland.

But no, not us. You must have us confused with the Rockefellers and Vanderbilts and the Carnigies and those other stupid "old" and "industrious" Americans. No, not us. We're modern Americans. We don't dare dream of never having to drive to work again. That's just not in our blood. No, we much prefer to sit 2 hours a day in bumper to bumper traffic while we hole up in some beige, tan cubicle and do mind-numbing tasks. That's the American dream!

This is the real reason why you are paying $4 in gas. This is the real reason why we have to spend billions on infrastructure that is unnecessary and unneeded. This is why there are thousands of deaths a year more than there has to be on roads. And this is a major reason why your families are stressed, torn or sometimes just plain destroyed. Because the American people failed to avail themselves of this most recent economic revolution because we just don't have the audacity to do so anymore.

Of course, there is another option.

You could do what I do.

Let me explain.

I get a call occasionally from a recruiting company called "Robert Half International." They have an office in DT Minneapolis. Their main finance/banking guy "Doug" knows who I am and knows that for the most part no bank in the area would hire me because of my super awesome book that predicted the housing crash (because why would you want to hire THAT guy? I mean who would want to hire the guy who PREDICTED THE BUBBLE?) In any case, when I do get a call from them, I know;

1. It's some rookie new hire who doesn't know I'm verbotten in the Minnesota banking industry
2. I'm not going to get the job (again because of my super awesome book you should all read).

So when it comes time for him to set up a "meeting to get to know you" I can more or less decree whatever I want because there's no way I'm getting the job in the first place.

Rookie - "Can you come downtown to meet me?"

Me - "No, how about you come to my local bar in my town. I usually start drinking around 1PM."


Rookie - "We have a position open in the vibrant DOWNTOWN AREA! You'll get to be where all the action is."

Me - "Will they pay me $20,000 extra per year to deal with the commute and give me an underground parking space in the building I'd be working in?"

Rookie - "Well (shocked), no...um, I don't think so."

Me - "Can I telecommute?"

Rookie - "Well,...um, I could ask but I highly doubt it."

Me - "Can I set my own hours to avoid rush hour?"

Rookie - "Ummmm...I think they would prefer you be there 8-5PM."

Me - "Eh, forget then, not interested."

In other words, desperate as the employment situation may be, why do you accept commuting? Why do you not demand the right to telecommute?

Sure, it's a bold move and sure there's plenty of other people out there willing to become the corporate slave who would just "love" to commute, but if the entirety of the US labor market would simply get a little self-respect and say, "eh, I'm not commuting" what could they do?

Then again, maybe I'm just crazy. Maybe people like to commute and waste years of their lives, missing out on seeing their children and spending time with their families. Maybe they like spending trillions of dollars on gas over the years. I mean, what better to spend your money on that gas, right? And who doesn't love the increased chance of divorce because "you're never home?" And did I mention all the icky yucky gross economic growth that would occur because of extra disposable income?

Yeah, we wouldn't dare take advantage of this latest revolution.


Country Lawyer said...

Actually, businesses are starting to do this in the U.S. because it cuts cost drasticly.

I know of some that have shut down offices and told their employees they're working from home now.

I think it is inevitable as the decline continues

Anonymous said...

My last office job literally consisted of downloading a spreadsheet every morning that listed the transactions that needed done, and looking up corresponding data on an internet database. My internet connection at home was at least twice as fast and didn't habitually go out for hours at a time (using computers that the lowest bidder was later proved to have sold knowing they were faulty), yet cow-orkers were fired specifically for asking if they could telecommute.

Meanwhile, the brass had no qualms about outsourcing the job -- and all of its data, which of course broke federal law by using SSNs as primary keys in its database -- to India, because apparently foreign nationals could be better trusted with those data than American citizens. And even after it WAS outsourced, I still had to keep driving to the office every day for a year to finish up all the work that the Indians either couldn't find time for or that they did do but just FUBARed.

So right now, as I type this, they're employing eight Indians to not do the same amount of work that I'm not allowed to do but with a VPN to the company's network could do without moving from where I sit. And their stock dropped 50% during my tenure.

daniel_ream said...

I know I've said this before, but I'll say it again for the record - it really isn't that simple, Cap. There are very real technical reasons why widespread telecommuting isn't being done.

There's certainly a lot of political resistance to it in most large organizations, but until you've actually rolled out and supported a fully-functional telecommuting/VPN infrastructure for a couple hundred people, you might want to tone down the rhetoric a bit. The devil, as always, is in the details.

Anonymous said...

In order for this to happen, we need a turnover in management. I can do my job telecommuting (mostly - I would never do it all the time), but my boss doesn't like. Has to have his little minions there to observe.

I have had 100% telecommuting jobs in the past and I would never do it again. Too easy to get shoved in a corner and forgotten.

Jaime Roberto said...

My company is redesigning the offices so that nobody has a fixed desk. They have to find a space when they arrive. I believe that this is a not-so-subtle attempt to get us to work at home more so that the cost of office space is outsourced to the employees.

Personally, I don't mind working at home once or twice a week, but more than that I think my productivity declines.

Anonymous said...

@Daniel Ream:

If it's so hard to support the infrastructure, how come they're so quick to outsource the same? It's gotta be just as easy to support a login from someone across town as it is one across the globe (in fact, probably easier, since most of the people in town speak English and it's not 10:00 p.m. for them when your people get into the office).

Anonymous said...

I don't ask because I'd never be able to hold down a job.

On the other hand, my fantasy football teams would DOMINATE and I'd soon be world-reknowned as a guy who can recognize female porn stars without looking at their faces.

But seriously, I do telecommute once every couple weeks when I need to get some serious writing and thinking done.

And when it's time to buckle down and get my fantasy football rosters straightened out.

Anonymous said...

how much time we heard this eden of work at home?

actually it is possible work from home for only a tiny fraction of jobs - much less than you could imagine.

only the most creative jobs - or, only those where people is really responsible for their equipment.

think about it, it is easy - at home i go in a porn site i get a virus and my pc is compromised - so i reformat and change porn site.

how much companies would tolerate this risk? do you think i would accept a company policy telling me "no porn/game/fun sites in your home navigation because you use your pc for job"? sure, to hell

Rick Caird said...

For a while I was the only remote employee of an internet development department. The problem was not access to the work. The problem was not being around for the hallway conversations where all the decision prep work gets done.

Captain Capitalism said...

You certainly couldn't have a designated computer for work and another one for ah....personal purposes.

Zookeeper said...

I dunno. You can drive past the Citrix office in San Jose and the parking lot is full of cars. If Citrix people won't telecommute why the hell would you expect the rest of us to?

Why not just hedge your oil costs by buying Shell stock? Good inflation hedge, now yielding 4.7% dividend? Then everyone else is paying for your gas.

Anonymous said...

A few comments.

If your job can be done without being onsite, your job can be easily moved to a low cost country like India, Brazil or China or a lower cost state in the the US such as South Dakota, North Dakota, etc.

Some of us in rural areas do not have high speed internet. Fastest I can get where I live is an anemic 256Kbps.

Some of us have job duties that require us to be onsite. We have hands-on duties.

Some companies like mine which had telecommuting are rapidly moving away from it for ulterior reasons.

The latest scam my company is doing is co-locating employees in a single facility far away from their current locations, telling them their job moved to the single facility and they have to move to that location at their own expense, otherwise it is considered a resignation.

Try explaining to your family Friday evening that starting Monday your job moved to Dubuque.

The purpose is cut costs by dumping employees that are expensive, are experienced, have families and have extensive roots. It's labelled a resignation so the company doens't have to pay unemployment or a severance package.

Once they get everyone co-located at one facility in an open office cattle-pen arrangement, they cross-train, do knowledge transfer, then layoff the experienced staff that moved.

The other part of this scam is that the company extorts the state and local governments for 10 years of incentives and tax-breaks in exchange for local jobs for local people. Never mind that the company has little intention of filling the number of jobs, level and local hire requirements.

All in a time of record profits.

Norm said...

All the reasons for NOT permitting telecommuting outlined by Our Dear Leader and the commenters are valid. One key that is missing is the general lack of discipline in today's workforce.
The lack of discipline starts at home with modern parents and is accelerated by public schools. Dress codes, sitting in neat rows and all the other stuff which, um, "stifle creative development" is actually inexpensive methods of instilling self discipline in students. Why do you think armies spend so much time on uniforms, parade drill and barracks inspections? It is a cheap means to instill discipline and measure achievement.
Too many employees will NOT spend their telecommunting time productively. My worksite ENCOURAGES telecommuting (we are auditors) but as we already are issued portable offices (laptop, printer, scanner, cell phone) for our field work (including out of province trips lasting up to four weeks straight) and regularly are out of the office for days at a time auditing we have the tools and the discipline to work without The Boss hovering over us. Mind you, you aren't allowed to telecommute until after your first year because a) The Boss wants to know you are reliable and not ditching off to a movie when you should be at a clients site and b) your still learning the ropes and will be asking loads of questions in which case an office with other auditors is best.

Chris said...

Taking it a step further, it would be great if we could actively encourage developers to include shared 'co-working' spaces within their apartments/neighborhoods.

It's actually kind of crappy (read: lonely) working from home, but if I could keep a desk a few steps from my front door I'd be a very happy camper. Personally I'd rather have that then a banquet room or gym.

The larger point is that the current admin COULD tie this all together and make it a national focus, but they instead choose to dump billions into high-speed (yuk, yuk) rail and doing whatever they can to herd people into electric cars.

I guess a solution that costs .gov $0 just isn't sexy enough?

Stephen J. said...

I did, in fact, work from home for about two years. It drove me absolutely flipping nuts, and the best day of my professional life was when I got a much better job in an office away from my home.

Why? Because when you work at home, YOU CAN NEVER GO HOME TO GET AWAY FROM WORK. I've always preserved my work-life balance by enforcing a *strict* separation. If I have to stay late for a specific project I stay, but when I leave the office, I leave the office.

Never underestimate the role of the primal, irrational needs of the human mind, including the need for physical proximity to other people and the need for ritual division of one's life activity.

Anonymous said...

I think it would be possible for most people to separate their home and work lives while telecommuting by having dedicated office space devoted to "work" while the rest of the house is considered home.

Robert Heinlein wrote about it in one of his books, can't remember which, sorry. But I've been able to balance my writing life (freelancer) and home life by having a room dedicated to writing.

Anonymous said...

Three quick points:

1) I can, and do telecommute 3 days a week in an effort to save coin.

2) I have worked for Robert Half.

3) Didn't you write a book at some point?

Chris said...

Gentlemen and Ladies, some comments.

1. If your job is totally unique, you can do it by telecommuting, from the place (tax haven) of your choice. There are very few jobs like that. But if you are NOT unique... there is a person in Sydney, Auckland, Moscow and in Bangalore who can do it just as well and probably cheaper.

2. Some jobs -- requiring hands on skills -- can't be done remotely. These range from farming to teaching to doctoring. These can't go to Bangalore.

3. Learn from disasters. A centralised system means that only one point has to fail for your firm to be borked. Smaller, spread out offices allow you to use small team dynamics -- multiple offices allow you to mirror multiple servers.

4. Computers are cheap. IT can easily use a stripped down, locked up version of Linux (or windows, or google OS) to allow you to do work and only work. Work computers are not for kids or recreation.

5. Teleconferencing is now cheap. You can run your team virtually a fair amount of the time... and meet face to face for planning "on sites" (which in most offices, are "off sites".

As an academic who has written commissioned work inside the states and co authors with colleagues from three countries, this is all doable. However, I don't live in the USA -- which helps.

Anonymous said...

I agree with the commenter who said if your job can be telecommutable, it can be moved to India.

Last company I worked for bought the division I was in for several years. In that division, I had full telecommuting privileges, but when the new company took over, that wasn't their culture. So when they eventually closed my office and offered me relocation to their home office, the new job would have *NO* remote work except for on-call. Thanks, but no thanks.

Anaylst said...

About 3 years ago I turned down a job at AIG because they wanted me to show up in their NYC office everyday I wasn't traveling. Working at home or at one of their suburban offices was apparently out of the question.

I took a job closer to home and still work at home twice a week. Any more than that would drive me absolutely stir crazy.

Anonymous said...

You might get a job with this guy:


Stephen J. said...

"I think it would be possible for most people to separate their home and work lives while telecommuting by having dedicated office space devoted to 'work' while the rest of the house is considered home."

Not when you live in a one-bedroom plus den condo with less than 600 square feet, your den has already been converted into your son's bedroom, and your work desk is in your own bedroom.

Telecommuting that requires you to buy a bigger home to preserve your psychological stability is not an economically feasible alternative.

Dali said...

I think it stems from middle managers' needs to look over the shoulders of their subservients and micromanage, giving them a sense of self-worth when in fact they hamper productivity. Not only that, they have a need to log all your internet browsing at the workplace and make sure you are sitting at your desk like a good little drone.