Keynes, the Good Life, and the Growth of Bullshit Jobs

David Graeber is a New-York-born anthropologist with an abiding interest in economic history.  He is currently at the London School of Economics as a professor of anthropology.  There is an advantage in viewing economics from the perspective of anthropology because that discipline actually requires one to look at economic actors as real human beings, not as the entities constructed by economists to fit economic theories.  He has provided a history of interesting and iconoclastic writings.  In 2013, he was asked to produce an article for Strike! magazine with provocative content.  What he delivered was titled On the Phenomenon of Bullshit Jobs.  Briefly, a bullshit job is one that entails meaningless or unnecessary activity. This piece was enthusiastically received by the public.  A poll in the UK indicated that 37% of respondents considered their jobs to be in the bullshit category.  The interest in the topic warranted an expanded version as the book Bullshit Jobs: A Theory.

Graeber begins his deliberations by recalling the long-ago prediction by Keynes that technology would allow us to produce everything we need while enjoying a much shorter work week—the good life.

“In the year 1930, John Maynard Keynes predicted that, by century’s end, technology would have advanced sufficiently that countries like Great Britain or the United States would have achieved a fifteen-hour work week.”

There is no reason to believe that technology has failed us.  Data clearly indicate that the number of workers required to provide food, clothing, and shelter has dropped considerably as a fraction of the work force.  What has grown in employment is what is loosely referred to as the “service sector.”  Since these services don’t actually produce a physical product, one must be suspicious of their value to society.

“But rather than allowing a massive reduction of working hours to free the world’s population to pursue their own projects, pleasures, visions, and ideas, we have seen the ballooning not even so much as the ‘service’ sector as of the administrative sector, up to and including the creation of whole new industries like financial services and telemarketing, or the unprecedented expansion of sectors like corporate law, academic and health administration, human resources, and public relations.  And these numbers do not even reflect all those people whose job is to provide administrative, technical or security support for those industries, or for tat matter, the whole host of ancillary industries (dog washers, all-night pizza deliverymen) that only exist because everyone else is spending so much of their time working in all the other ones.”

“These are what I propose to call bullshit jobs.”

The net result, in Graeber’s view, is that we who are not directly involved in producing a product are in fact working about fifteen hours a week but spending the remainder of the forty or more hours in bullshit activities.

“While corporations may engage in ruthless downsizing, the layoffs and speed-ups invariably fall on the class of people who are actually making, moving, fixing, and maintaining things.  Through some strange alchemy no one can quite explain, the number of salaried paper pushers ultimately seems to expand, and more and more employees find themselves—not unlike Soviet workers, actually—working forty- or even fifty-hour weeks on paper but effectively working fifteen hours just as Keynes predicted, since the rest of their time is spent organizing or attending motivational seminars, updating their Facebook profiles, or downloading TV box sets.”

Not surprisingly, Graeber does have an explanation for that strange alchemy.

“The ruling class has figured out that a happy and productive population with free time on their hands is a mortal danger.  (think of what started to happen when this even began to be approximated in the sixties.)  And, on the other hand, the feeling that work is a moral value in itself, and that anyone not willing to submit themselves to some kind of intense work discipline for most of their working hours deserves nothing, is extraordinarily convenient for them.”

The sense that one is working in a bullshit job fosters resentment against anyone who might have a job of value.

“Yet it is the peculiar genius of our society that its rulers have figured out a way…to ensure that rage is directed precisely against those that actually do get to do meaningful work.  For instance: in our society, there seems to be a general rule that, the more obviously one’s work benefits other people, the less one is likely to be paid for it.”

“Even more perverse, there seems to be a broad sense that this is the way things should be.  This is one of the secret strengths of right-wing populism.  You can see it when tabloids whip up resentment against tube workers for paralyzing London during contract disputes: the very fact that tube workers can paralyze London shows that their work is actually necessary, but this seems to be precisely what annoys people.  It’s even clearer in the United States, where Republicans have had remarkable success mobilizing resentment against schoolteachers and autoworkers (and not, significantly, against the school administrators or auto industry executives who actually cause the problems) for their supposedly bloated wages and benefits.  It’s as if they are being told ‘But you get to teach children!  Or make cars!  You get to have real jobs!  And on top of that, you have the nerve to also expect middle-class pensions and health care?’”

Graeber uses his book to fill in details associated with these conjectures.  The result is a fun ride for the reader.  Much of the detailed descriptions of the bullshit jobs that abound come from readers of his original essay who agreed that their jobs were worthless or unnecessary.

To understand the growth of bullshit jobs, one must first understand what the increase in service sector jobs actually means.  Graeber tells us that the traditional service sector jobs such as waiters and salesclerks have been constant at about 20% of the workforce over the last century.  The sector growth came from new types of jobs, ones that had less-clear indicators of what the work entailed.

“The vast majority of those others included in the service sector were really administrators, consultants, clerical and accounting staff, IT professionals, and the like…This of course is precisely the zone in which bullshit jobs proliferate.”

One might assume that bullshit jobs are not possible in a modern economy where corporations are tuned to run at high efficiency.  But that assumption is exactly what allows such things to occur without being noticed.  Plus, the tendency to create unnecessary jobs in some industries is not an accident, it is a feature.  If a corporation’s role is to extract as much in funds as possible from a customer for providing a service, that fee must be justified by identifying numerous employees performing numerous tasks.  Inefficiency and profit can be correlated.  But what about competitors?  Why compete when it lowers the profit margin.

Graeber draws an interesting comparison between feudal lords and modern corporate leadership.

“…feudalism is essentially a redistributive system.  Peasants and craftsmen produce things, to a large extent autonomously; lords siphon off a share of what they produce, usually by dint of some complex set of legal rights and traditions…and then go about portioning out shares of the loot to their own staff, flunkies, warriors, retainers…”

“…doctrinaire libertarians, or, for that matter, orthodox Marxists, will always insist that our economy can’t really be riddled with bullshit jobs; that all this must be some sort of illusion.  But by a feudal logic, where economic and political considerations overlap, the same behavior makes perfect sense…the whole point is to grab a pot of loot, either by stealing it from one’s enemies or extracting it from commoners by means of fees, tolls, rents, and levies, and then redistributing it.  In the process one creates an entourage of followers that is both the visible measure of one’s pomp and magnificence, and at the same time, a means of distributing political favor: for instance, by buying off potential malcontents, rewarding faithful allies…or creating an elaborate hierarchy of honors and titles for lower-ranking nobles to squabble over.”

“If all of this very much resembles the inner workings of a large corporation, I would suggest that this is no coincidence: such corporations are less and less about making, building, fixing, or maintaining things and more and more about political processes of appropriating, distributing, and allocating money and resources.”

Graeber provides numerous examples of the existence of bullshit jobs and the tendencies to create them.  Many came from individuals who responded to his original article with their own tales of woe.  However, we begin with one from his own academic world.

In the period between 1975 and 2005 it was determined that positions for administrators and managers at public colleges increased by 66%.  This increase was not associated with any increase in students or faculty and did not seem to be associated with any advances in education, the main function of a college.  One should be suspicious of this job growth.  Now consider that over the same period, the growth in the same class of jobs at private colleges was an even heftier 135%.  What is the main difference between the two cases?  Public colleges have greater budget constraints, while private schools have greater opportunities to increase the “pot of loot” available to an “entourage of followers.”  Graeber includes this quote from an anonymous British academic.

“Every dean needs his vice-dean and sub-dean, and each of them needs a management team, secretaries, admin staff; all of them only there to make it harder for us to teach, to research, to carry out the most basic functions of our jobs.”

In the UK a scandal broke in 2006 when it was realized that banks had been extracting loot from their customers by inducing them to buy essentially worthless insurance policies—payment protection plans (PPI).  The financial firms were required to refund most of the money to their customers.  This necessitated the accumulation of a huge pot of money and the identification of a huge financial entity to handle the distribution of the funds.  Participants in this process were quite willing to share their experiences with Graeber.  The process seemed to be intentionally inefficient in order to collect an ever-greater fraction of the pot in fees for the service provided.

“This is actually a fairly common story in the testimonies I received: I heard about similar things going on in law firms involved in asbestos compensation payments as well.  Whenever a very large sum of money, in the hundreds of millions, is set aside to compensate an entire class of people, a bureaucracy must be set up to locate claimants, process claims, and portion out the money.  This bureaucracy may often involve hundreds or even thousands of people.  Since the money that pays their salaries is ultimately coming from the same pot, they have no particular incentive to distribute the spoils efficiently.  That would be killing the goose that laid the golden egg!...this often led to ‘crazy, surreal stuff’ like intentionally placing offices in different cities and forcing people to commute between them, or printing and destroying the same documents a half dozen times—all the while threatening legal action against anyone who revealed such practices to outsiders.”

Graeber pinpoints the financial sector as ground zero for bullshit jobs.

“In a way, one could argue that the whole financial sector is a scam of sorts, since it represents itself as largely about directing investments toward profitable opportunities in commerce and industry, when, in fact, it does very little of that.  The overwhelming bulk of its profits comes from colluding with the government to create, and then to trade and manipulate, various forms of debt.  All I am really arguing in this book is that just as much of what the financial sector does is basically smoke and mirrors, so are much of the information-sector jobs that accompanied its rise as well.”

Graeber relates the experiences and observations of one worker who he refers to as Irene.

“Irene, for example, worked for several major investment banks in ‘onboarding’—that is monitoring whether the bank’s clients (in this case, various hedge funds and private equity funds) were in compliance with government regulations.  In theory, every transaction the bank engaged in had to be assessed.  The process was self-evidently corrupt, since the real work was outsourced to shady outfits in Bermuda, Mauritius, or the Cayman Islands (where bribes are cheap), and they invariably found everything to be in order.  Nonetheless, since a 100% approval rate would hardly do, an elaborate edifice had to be erected to make it look as if sometimes, they did indeed find problems sometimes.  So Irene would report that the outsider reviewers had okayed the transaction, and a Quality Control board would review Irene’s paperwork and duly locate typos and other minor errors.  Then the total numbers of ‘fails’ in each department would be turned over to be tabulated by a metrics division, this allowing everyone involved to spend hours every week in meetings arguing over whether any particular ‘fail’ was real.”

“There was an even higher caste of bullshit, propped atop the metrics bullshit, which were the data scientists.  Their job was to collect the fail metrics and apply complex software to make pretty pictures out of the data.  The bosses would then take these pretty pictures to their bosses…”

The collected examples Graeber received allowed him to formulate a kind of “law of bullshit job creation.”

“As a general principle, I would propose the following: in any political-economic system based on appropriation and distribution of goods, rather than actually making, moving, or maintaining them, and therefore, where a substantial portion of the population is engaged in funneling resources up and down the system, that portion of the population will tend to organize itself into an elaborately ranked hierarchy of multiple tiers (at least three, and sometimes ten, twelve, or even more).  As a corollary, I would add that within those hierarchies, the line between retainers and subordinates will often become blurred, since obeisance to superiors is often a key part of the job description.  Most of the important players are both lords and vassals at the same time.”

Two things to take away from Graeber’s arguments are that corporations, and capitalism itself, have been infected by financialization, and that infection has shaded economic decisions with the politics of human interactions.

“During most of the twentieth century, large industrial corporations were very much independent of, and to some degree even hostile to, the interests of what was called ‘high finance.’  Executives in firms dedicated to producing breakfast cereals, or agricultural machinery, saw themselves as having far more in common with production-line workers in their own firms than they did with speculators and investors, and the internal organizations of firms reflected this.  It was only in the 1970s that the financial sector and the executive classes, that is, the upper echelons of the various corporate bureaucracies—effectively fused.  CEOs began paying themselves with stock options, moving back and forth between utterly unrelated companies, priding themselves on the number of employees they could lay off.  This set off a vicious cycle whereby workers who no longer felt any loyalty to corporations that felt none toward them, had to be increasingly monitored, managed, and surveilled.”

What has resulted is a modified—contaminated if you prefer—form of capitalism that does not conform with traditional economic expectations and may be leading the world in a direction that it would rather not follow.

“If the existence of bullshit jobs seems to defy the logic of capitalism, one possible reason for their proliferation might be that the existing system isn’t capitalism—or at least, isn’t any sort of capitalism that would be recognizable from the works of Adam Smith, Karl Marx, or, for that matter, Ludwig von Mises or Milton Friedman.  It is increasingly a system of rent extraction where the internal logic—the system’s ‘laws of motion’ as Marxists like to say—are profoundly different from capitalism, since economic and political imperatives have come largely to merge.  In many ways, it resembles classical medieval feudalism, displaying the same tendency to create endless hierarchies of lords, vassals, and retainers.  In other ways—notably in its managerialist ethos—it is profoundly different.  And the whole apparatus, rather than replacing old-fashioned industrial capitalism, is instead superimposed on top of it, blending together in a thousand points in a thousand different ways.  Hardly surprising, then, that the situation seems so confusing that even those directly in the middle don’t really know quite what to make of it.”