February 7, 2014

Million American Jobs Project: Does it really have anything to do with American jobs?

Last August, this video appeared on YouTube:

By taking a fraction of our spending and buying US-made goods, we'll create a economic tidal wave. Watch the vid and share it. Boom, you're helping make jobs.

Well, I watched the video.

"If every one of us shares this video with two people within a day of seeing it, in one month's time it will have been seen by pretty much every single person in the country."

Okay, let me just discuss this minor point, and I'll explain why later.

If one person shares the video with two people on day 1, and they share it with four on day 2, and so on, then on day 30 it will have been seen by 1+2+2²+2³+2⁴+...+2²⁹+2³⁰ people. My calculator says that's 2,147,483,647 people, which is almost 7 times the population of the US.

Now, anyone who's ever heard of a pyramid scheme, or has a gram of intelligence, can tell you why there won't really be 2 billion viewers. The most obvious problem is that, even if everybody shares like they're supposed to, within a week or so you'll have a hard time finding two of your friends who haven't already seen it. Add to this the real-world issues of people who will not watch it, people who will not share it, people who don't use the Internet, etc., and it will NOT be "seen by pretty much every single person in the country." (In fact, the video has been up for almost 6 months, and has only 2.8 million views -- which is a lot for YouTube, but nowhere near our 314 million population.)

The reason I'm making a fuss about this trivial point is that it exemplifies the simplistic thinking in the video. The economy is a complex living thing. You can't make one small tweak and, voilà, get exactly the result you want. If it were that simple, we could just set up a centrally-planned economy and stop worrying about everything.

For example, the video says: "And while it might cost just a little bit more, in the long run it'll cost a whole lot less." Okay, prove that. Because if it costs me just a little bit more to buy American, then that means I will be spending or saving that little bit less. How, exactly, does that work out in the long run? What happens to the businesses who lose out on the little bit less I didn't spend on them? What happens to my savings, and what will happen after retirement or unemployment when I need just a little bit more welfare money to make up for my little bit less savings?

It doesn't matter if it's only 5%, the question is what is the effect? If my 5% is actually going to make things worse, then I'm not gonna do it. Just saying that something is obviously good doesn't prove that it's genuinely good.

For more about the economics, check these two articles:

The "Buy-Local" Canard by Tyler A. Watts. A short article about the problems with "buy local" campaigns.
Free Trade by Alan S. Blinder. A longer article about protectionism and the principle of comparative advantage.

Now, on top of that, there's an ethical point. Why is the well-being of certain people supposed to be more important to me than the well-being of other people, just because they live inside the same political boundary with me? I mean, yes, Americans are out of work -- but folks in many other countries are literally starving to death for lack of work. What will be the effect on them if I buy American?

And this brings up another real-world issue. If people are hungry and unemployed in other countries, this does have an effect on the US. Social instability anywhere always tends to drag us in. But a more direct effect is immigration. I mean, I always hear folks yelling about Mexican immigrants -- how come I never hear them organizing a "buy Mexican" campaign to keep that country economically healthy?

Finally, there's the question of just who the heck is www.millionjobsproject.us? Well, it's a project of advertising guy Alex Bogusky, who left his old job with Crispin Porter + Bogusky to set up a new ad agency called Made, which specializes in advertising made-in-USA products, and Made Collection, which sells assorted made-in-USA products online.

I'm not going to question Bogusky's dedication to his cause, but it does seem to be rather intimately tied up with his business interests.

Oh, and by the way, that website puts 5 cookies on your computer, one of which lasts 6 months and stores an ID number and the referring site that sent you there, and another of which lasts 2 years and stores a similar ID number. I'm just guessing, but I assume that companies who pay for the info will be told whether your specific cookie corresponds with a click on the "Pledge" button. This could be of value to companies who sell made-in-USA products, and possibly also to political organizations, some news media, etc.

Granted, that's the way the Internet works nowadays, and it's no different than what a zillion other Internet businesses are doing to track us. But yeah, if you want to click a button on a website run by an advertising agency, you shouldn't be surprised at the results.