The Toyota Production System: a milestone and revelation in human affairs, or just a rightward shift of the supply curve?

Posted on January 30, 2021 by Nicholas Gruen

About a year ago, I happened upon the video above and it reminded me of the revelation that the Toyota production system was to me when I first encountered it in 1983. I was working for Industry Minister John Button and reviewing Australia’s car industry and wondering how to reform the hornet’s nest of protectionist regulation that the industry had been entangled in since local content plans were first introduced in the 1960s. (One of the main instigators was Sir Charles McGrath who – from memory – combined his chairmanship of major car parts manufacturer Repco and the Victorian branch of the Liberal Party to great effect. But I digress.)

In any event, the Japanese had quadrupled labour productivity in a decade or so with this new socio-technical system. Toyota was a major influence on much of the language of management we still hear today – flat structures, empowering workers and so on. But it’s easy to say these things. They demonstrated beyond a shadow of a doubt that they had made them work.

The Toyota production system was for me – a pragmatic step up in human evolution – a step on the ‘high road’ which plays to the better angels of our nature, and shows how this can give us lives that are better in every respect – more respectful, purposeful, intelligent, autonomous and productive than the alternative, previous Fordist or Taylorist model of production. This was Adam Smith’s aspiration for economics. I’m still amazed that economists took so little interest in it. They simply note it’s a rightward shift of the supply curve and move on.

Anyway, if you bother to watch the video (and I sympathise as I don’t like watching videos – you can at least listen to it while you do something else) I hope you’ll find it as compelling as I did. You may not, but I liked its ‘daggy’ quality. There’s no hoopla about this guy and indeed some unease about talking about ‘leadership’ in the vacuous and hyped up way we do now.

I think the ideas implicit in the Toyota production system represent a synthesis of ideals and practicality that is incredibly rare and hugely valuable.

As is my recent practice, I’ve got my robopeeps to do a transcript of the talk which I’ve reproduced over the fold (mistakes and all) in case you want to zip through it to find what might be of interest to you a little faster. Continue reading →

Posted in Uncategorized | Leave a comment

Science, objectivity and the separation of knowing and doing

Posted on January 29, 2021 by Nicholas Gruen

I.

Given its astonishing success, modern minds are mesmerised by science. So much so that various disciplines adopted certain mannerisms of science in order to make themselves more ‘scientific’. This is the intellectual sin Hayek and others called ‘scientism’.

Having come to understand why this was mostly a dead-end in the discipline of history, I’ve always been wary of scientism in economics and public policy. But having tried to solve problems in these areas on their own terms, I’m often taken aback that what I’ve come up with really is in the spirit of science. The difference is that, as Michael Polanyi put it, science is “a sphere of thought which can only live in pursuit of its own internal necessities”.[1]

If one has lived in pursuit of those internal necessities, and gained some insights, then Polanyi is suggesting that that process is itself science. Polanyi’s view was that the quest to systematise science – to police some demarcation between science and non-science – could never be brought off, a view that has been vindicated so far.

In the introductory section of this essay, I want to highlight two things that I’ve discovered are fundamental to good policy and practice in the field – that have direct counterparts in the natural sciences.

  • First, I was once on a panel with Peter Doherty and talking about the importance of building ‘bottom-up’ knowledge in social programs (as I do!). Peter Doherty piped up and said “Science is bottom-up”. Quite.
  • A second, but closely related idea is Richard Feynman’s. The “first principle” of science is that “you must not fool yourself and you are the easiest person to fool”.

Note that these are aspirations. And because they are difficult, science has developed methods that help scientists achieve them. I don’t think we’ve done that in public policy.

The next section provides a vignette from natural science which illustrates the two points above. The third, concluding section circles back to policy, broadly considered to mean the study of, and attempts to improve the human world. It looks at ways in which, policy practice will look different from the natural sciences if it is to “live in pursuit of its own internal necessities”.

II.

Lorraine Daston and Peter Galison’s book Objectivity provided the initial impetus for this essay. The book shows how scientific atlases – or visual representations of scientific knowledge – illustrate the transition between three different kinds of scientific knowing. It traces three ideal types of scientific knowing – Truth-in-nature, Objectivity, and Trained Judgement. Though the presence of one doesn’t always exclude the other, each ideal type was at its apogee around the middle of the 18th, 19th and 20th centuries respectively. Continue reading →

Posted in Economics and public policy, Science | Leave a comment

Are the covid lights going on in the States?

Posted on January 26, 2021 by Paul Frijters

An important rule in politics is that you adopt the best policies and slogans of your opponent only after you have destroyed that opponent. Till that moment you pretend he is the devil, but afterwards you re-label his best ideas and call them your own. A great Australian example is how John Howard in 1995 ran on a ‘never ever GST’ platform, and then introduced it himself in 2000.

Are we now seeing the same happen in the US when it comes to covid? Are the Democrats adopting Trump’s attitude to the virus now that he is no longer around and temporarily muzzled in the media as well? It would be the best news on the covid-mania front in months. Where the US leads on this, many will follow. Consider the signs.

The biggest sign is from the biggest state, California, where its Democratic governor has just lifted all stay at home orders and is allowing restaurants to open, despite very low vaccination and high case numbers. The Democratic New York Governor has similarly stopped talking doom and gloom and is demanding re-opening despite rising active case numbers.

Montana’s governor has done away with nearly all Covid restrictions and has now joined Florida, Georgia, South Carolina, and South Dakota that abandoned covid-mania months ago or even managed to avoid it almost entirely in the case of South Dakota.

In smaller steps, Massachusets’ governor Charles Baker, is opening up restaurants and businesses; Washington, D.C. is going to allow indoor dining; Maryland’s governor said schools will reopen no later than March 1;  Michigan is going to allow indoor dining on February 1; Chicago’s mayor is announcing an immediate opening of restaurants and bars, and threatening teaching unions to resume teaching.

The mainstream media is also showing a dramatic shift in tone. The New York Times ran a long piece on the cost to children from lockdowns and school closures; National Radio claimed the peak of covid was over, and the Washington Post is starting to talk about T-cells and natural immunity as if they are important things people should discuss rather than fringe theories by holocaust covid-deniers.

One suspects all this is Joe Biden at his best: a consensus figure who worked out a long time ago that the lockdowns were a nonsense but had no political alternative than ride the line that Trump was an evil idiot and that he hence could not possibly be right about covid-mania. Now that Trump has been silenced, at least temporarily, Biden and the Democrats can take his most sensible ideas (as they have also done on such issues as defense spending in the EU, btw) and claim them as theirs. By signing high-profile but largely symbolic low-impact orders related to covid (on vaccine production and such, again copying Trumps’ playbook of commanding private companies) he can claim the ‘tough on covid’ mantra while on the substance doing the opposite.

Most tellingly perhaps, Biden said on Fox news (yes, formerly the media home of Trump) that “There’s nothing we can do to change the trajectory of the pandemic in the next several months.”

Note that ‘nothing we can do’ includes both vaccinations and lockdowns! Imagine if candidate Joe Biden had said the same words before the elections. How the covid-maniacs would have howled, but interestingly they are remarkably silent in the US now. As is normal in many wars, once one is clearly lost and found out to be entirely inappropriate in the first place, its generals quickly develop amnesia and find some new target to distract us with. The howling hangers-on find something else to howl about.

Let’s hope the signs are right and that we’re not looking at another false dawn as we’ve had last summer in this saga. If it is a new dawn deliberately brought to us by the new POTUS, then well played, Joe! And what a delicious irony for Trump. I was never a Trump fan but you’d almost feel sorry for the guy that his most sane insight should be the one related to his downfall and then usurped by his opponent. There is a Greek play in that.

Posted in Coronavirus crisis, Cultural Critique, Death and taxes, Democracy, Economics and public policy, Geeky Musings, Health, Humour, Politics - international, Social, Social Policy | 13 Comments

Can you spot the countries with high vaccinations? Or recent lockdowns?

Posted on January 20, 2021 by Paul Frijters

I am all for effective vaccines and have been impressed with how fast vaccines have been developed against covid, but I never expected them to be the wonder weapons some promised them to be. After all, the yearly new vaccines against the flu never eradicated the flu but reduced their death toll, which is of course still a good thing but not a ‘final victory’. Gradually, the limitations of the covid-vaccines and the negative side-effects are starting to dawn on many.

To help the reader test herself on whether the vaccines are an immediate game-changer, find below the graphs on covid-deaths for four countries over the last three months. Two of these countries are in the high-vaccination group of countries with large roll-outs among the vulnerable starting before 2021, whilst two other countries are in the lagging group. All four countries participate in Eurovision. Try and put these countries into the right ‘vaccination order’ without cheating …

 

While we are at it, have a guess which of these countries introduced new lockdowns and when, or which ones changed regulations on mask wearing and when? If such policies have the clear effects politicians claim for them when they announce them, it should be easy to work out what policies were implemented and when from such graphs, even allowing for whatever lag you think is appropriate.

Think of what these limitations mean for what will inevitably happen if Australia opens up fully again. A stark choice awaits….

Posted in Coronavirus crisis, Health, History, Innovation, Medical, Politics - international, Politics - national, Society | 12 Comments

History is repeating: Dennis Glover on the Capitol Hill riot

Posted on January 15, 2021 by Nicholas Gruen

If something can happen once, it can happen again. This is the oft-ignored first lesson of history. The second lesson is that humans usually forget lesson number one. Watching the attempted coup unfold at the Capitol building, those two lessons kept working through my mind. Never have I felt like I was living so intensely in history. Maybe you did too.

In 1923, after almost a decade of economic suffering caused by the First World War, Germany was hit by an intense economic shock – hyperinflation, which destroyed middle class savings and raised the cost of a simple loaf of bread to several billion marks. Into this turmoil stepped a little known agitator named Adolf Hitler – a man considered an embarrassment to his establishment backers but who had a gift for speaking to the people. On the night of 8 November, in a Munich beer hall, Hitler assembled a ramshackle collection of his followers – angry extremists dismissed as uneducated buffoons, and right-wing establishment figures who thought they could easily control him – and convinced them to take over the Bavarian state government and march on to Berlin to seize power. In a confused, pathetic fiasco, four policemen and 14 others were killed and Hitler slinked away to later be arrested. Continue reading →

Posted in Democracy, Economics and public policy, History, Political theory, Politics - international | 62 Comments

A brief summary of a long work – Piketty’s Capital and Ideology: by Ian McAuley

Posted on January 10, 2021 by Nicholas Gruen

Ian McAuley circulated the summary below and I asked him for permission to make it available here – which he agreed to. Piketty’s books remind me of one of John Clarke’s lines. Back in Fred Dagg’s ten minute History of Western Civilisation, he commented that “The Russians experimented with the thickness of the novel, and found that it could become very thick indeed”.

Ian’s summary is over the fold.

Continue reading →

Posted in Democracy, Economics and public policy, History | 1 Comment

Historical analogies for the covid-mania

Posted on January 8, 2021 by Paul Frijters

“men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses more slowly, and one by one.” MacKay, 1841.

The Simpsons: 5 Old Characters We Miss (& 5 That Should Probably Be Phased Out)Right now, London and much of Europe are in peak covid-mania, entering another two months of lockdowns on top of the ineffectual lockdowns of 2020. Whilst not credibly leading to any reduced number of covid-deaths, the UK government’s action have so far cost over five million happy years of life just by reducing the quality of life some 10% for a population of 70 million for nearly a year. The roughly one billion pounds of extra borrowing needed per day to buy off dissent and hide the forced collapse of productivity will down the line cost about 1 million happy years of life per month of lockdowns via reduced future government services. Even if they would save 0.2% of the population via the most vulnerable (which they clearly don’t), the lockdowns destroy the equivalent of that ‘promised gain’ in terms of happy years of life every single week of lockdowns. This frankly insane state of play was summed up well by a conservative politician who openly said in parliament (the only place that cant be censored) that “This is a situation of state capture. Government is completely enthralled by a lobby pushing the failed policy of lockdown. Despite the arrival of vaccines, the lobby has signalled that social control won’t end, some restrictions will remain & measures may be reimposed next winter”

To date, the UK government has abandoned its duty to educate children by closing schools, abandoned its duty towards public health by neglecting non-covid health problems, abandoned its duty to ensure the population maintains its livelihood by preventing ‘non-essential workers’ from doing their job, and has demoted the majority of the population to virus risk vectors. Births are now expected to plummet and future deaths of non-covid health problems are assured to be much higher in the coming years. The choice to destroy health, joy, life, and liberty on this massive scale fits the dictionary definition of insanity, ie irrational self-harm. The main thing that obscures the insanity of the situation is that the vast majority of the population has gone along with it, abandoning their own responsibility towards their children, their family, their own futures, and their country. The situation in the UK is repeated in much of sub-Scandinavian Europe and in most states of the US.

The weirdness of the situation is reflected in the contradictions of the policies. The UK covid death cult urges the population to come to a social standstill to prevent infections, but millions of ‘essential workers’ are running around the country as normal. ‘Inessential’ market activities are supposedly shut down, but viewing and selling houses is strongly encouraged with tax-breaks and travel-exemptions, which is because the groups in charge own property and are looking after themselves. Gathering and hugging are depicted as lethal when the general population does it, whilst the police and health workers huddle together. Those who run almost no risk are prevented from gathering in groups (children) whilst those who run the most risks are packed together with many others who are sick in nursing homes and hospitals. State propaganda is seen and heard everywhere, from posters on the street to commercials on radio, whilst censorship of dissenting voices is widespread. After their failed predictions cost them nothing, some medical advisers are already advocating that even if everyone is vaccinated the whole country should lock down next winter anyway, bemoaned only by the odd brave member of parliament. Much of the novel 1984 is thus now reality.

Let us go over several possible historical analogies one can think of for the current situation to try and expand our ideas on what might happen next. I want to discuss the analogies with the Dreyfus affair, the US Prohibition and the Vietnam war, medieval feudal Catholicism, medieval feudal Christian Orthodoxy, and the communist/Nazi crowds of central Europe in the 1920s-1940s.

Continue reading →

Posted in Coronavirus crisis, Cultural Critique, Death and taxes, Economics and public policy, Employment, History, Libertarian Musings, Political theory, Politics - international, Science, Social Policy, Uncategorized | 48 Comments