Wednesday, February 24, 2016

Do Americans Today Have More Servants Than Did J.D. Rockefeller?

By Don Boudreaux

Warren Meyer, having read my recent post on the likelihood that a randomly chosen middle-class American of today is materially richer than was the richest American of 100 years ago, e-mails to remind me of this post of his from 2007.  Do read all of Warren’s superb post.  It supplies excellent evidence that we ordinary Americans today are indeed materially richer than were American billionaires of a mere century ago.
I take this opportunity to address a criticism of my post that has arisen in different places and in a variety of ways.  That criticism (as I summarize it) is that J.D. Rockefeller in 1916, compared to an ordinary American of 2016, could buy and “control” the services of many more people – specifically, workers and servants.
Overlook the fact that J.D. Rockefeller could no more “control” the services of a servant or worker than could a middle-class American of 1916.  Rockefeller did indeed have the money to contract for the labor services of many people, but those contracts were mutually agreeable: Rockefeller had no slaves.  (In Ron Chernow’s 1998 biography of Rockefeller – Titan – Chernow at one point expresses his surprise that Rockefeller’s employees seemed genuinely fond of him.  Chernow is surprised because Rockefeller’s business rivals were decidedly not fond of him.  Chernow missed the fact that Rockefeller’s actions – his vigor at competing against rivals and his good treatment of his employees – are precisely the sort of actions that we expect in genuinely competitive markets.)
A larger point is this one: each ordinary American today has working for him or her literally several hundred million people; actually, the number is more likely in the billions.  As with Rockefeller, these servants of ours are our servants only through voluntary contracting.  Of course, we know almost none of our servants personally.  But the countless people who put forth the effort, intellectual and manual, to build the dwelling in which you live, the other group of countless people who worked to supply you with the food you ate today, and yet a third group of countless people who labored to produce the pencil that you used yesterday to scribble your grocery list – these countless people are in a very real way our servants no less than were the butlers, valets, cooks, and gardeners who attended to J.D. Rockefeller and his family.
The big difference between us today and Rockefeller is that, thanks to globalization, each of us has many more servants working for us than he had –and, unlike many of Rockefeller’s servants, very few of ours need by physically present in our homes and, therefore, they do not intrude on our privacy.
The above originally appeared at Cafe Hayek.

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