As the holidays approach, we are being reminded of the fragility of the global supply chain. But at the same time, the supply chain itself is a truly impressive and fascinating structure, made as it is from multiple components that must work together in synchrony. From building an item in a factory and shipping it worldwide to transporting it locally, processing it in a distribution center, and finally delivering it to an address, the system is simultaneously awe-inspiring and deeply dehumanizing. I talk with Christopher Mims about how things are made, how they get to us, and what it all means for the present and future of our work and our lives.
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Christopher Mims received a bachelor’s degree in neuroscience and behavioral biology from Emory University. He is currently a technology columnist at The Wall Street Journal. He has previously written for publications such as Wired, Scientific American, The Atlantic, and Smithsonian. His new book is Arriving Today: From Factory to Front Door — Why Everything Has Changed About How and What We Buy.
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0:00:16.5 Sean Carroll: Hello, everyone, and welcome to the Mindscape Podcast. I’m your host, Sean Carroll. Chances are that the technology that you’re using right now to listen to this podcast was built somewhere else, very likely that whatever country the phone or tablet or computer you’re using to hear me talk right now was assembled in a different country than you’re living in right now. If not, then some piece of it was, some dongle or some wire or something like that. We take for granted that we rely on stuff, whether it’s high-tech stuff or clothing or everyday household appliances, that was built and manufactured and assembled somewhere else. Since we’ve had a pandemic and we’ve been in lockdown, we’ve been increasingly used to having stuff delivered directly to our door, whether it’s books or groceries or food for the evening. This is an incredibly complicated system, as you might imagine, and it’s really kind of a monument to human ingenuity that we’ve built a system of global commerce that really uses the whole globe, that we build things in one place, we get the raw materials in an other place, we consume them in another place. So how does all this work? This is the problem tackled by Christopher Mims, who is a journalist at the Wall Street Journal, in his new book called “Arriving Today: From Factory to Front Door, Why Everything Has Changed About How and What We Buy.”
0:01:42.9 SC: I’m sure you remember the Ever Given disaster, or at least a snafu, maybe not disaster, but this giant container ship that got stuck in the Suez Canal a few months ago and slowed down all of global commerce. So that’s a reminder on the one hand, that there are fragile points in this system, but it’s also, just amazing to look at these ships, these gi-humongous vessels stacked with these containers, and these containers are part of the intermodal transport system, the containers, the boxes that are on the ships need to be unloaded incredibly quickly in some very busy port and then stacked onto trucks, trailers, and then taken somewhere else, usually to be unpacked and put on different trucks. And all of this is just incredibly interconnected, incredibly time-sensitive, and is still in credible flux. We’re not done yet. We’re not done yet innovating how all this works. So the subject here is industrial ecology, how you build this stuff, how you ship it, and the ways in which this search for evermore efficiency and productivity have shaped how you work, how you work in a factory, in a manufacturing center, or also just in a distribution center, increasingly these days.
0:03:04.8 SC: Look, I’m not gonna sugarcoat it. It’s a little dehumanizing, some of these stories, about what it’s like to work in a distribution center or work as a trucker or a driver for delivery service, really call into question the job we’re doing as a society in providing people with good jobs that are fulfilling in different ways. And on the one hand, let me say that a lot of the structure is invisible to most of us. If we’re not in that business or whatever, we sort of take it for granted, and we think about us and them, and it’s a very different world. On the other hand, I think and hope that there are people out there who are long haul truckers or delivery people right now listening to the Mindscape Podcast, and so this episode is dedicated to you because you play a crucially important role in how our society as a whole runs, and I would like your condition in life to be a little bit better. I’m not sure how much influence I have over that, but it’s something to shoot for. The end of the episode, Christopher and I will talk about ways we can improve the current system.
0:04:12.0 SC: There are things that are just inevitable, also things that are choices and we can make better. So we’re gonna try to figure out how to do that. Let’s go.
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0:04:36.9 SC: Christopher Mims, welcome to the Mindscape Podcast.
0:04:38.8 Christopher Mims: Thanks for having me, Sean.
0:04:40.4 SC: So I don’t want to actually accuse you of being responsible for the pandemic that we’re all suffering through right now, but it certainly is convenient that in the time when we’re all reliant on things suddenly appearing to our house from Amazon or from delivery services or whatever, you’ve written a book about the process by which things appear at our house. So how much of this is good planning and how much of this is just the cosmic wheel spinning in unpredictable ways?
0:05:07.6 CM: It does quite make me question whether I’m the only conscious being in the universe and I’m just manifesting all of this or… Because yeah, it is absolutely bizarre that on a whim, a super nerdy whim, I said, “I wanna understand where my stuff comes from,” this almost child-like impulse, and then I was like, “I’m gonna write a long explainer of that, a book-length explainer of that,” and in the middle of researching and writing it, the pandemic hit, and global supply chains seized up, and then exploded, and then the debris fell over all of us, and my reporting went on. And then something… [chuckle] I was reporting in the middle of that, and having absolutely surreal conversations with people responsible for cleaning up that mess, which I’ll never forget.
0:05:54.0 SC: From the point of view of the inside of this whole supply chain, were there dramatic changes because of the pandemic, or was it just like more intensity to get stuff to people?
0:06:08.8 CM: It’s difficult to say whether the increased intensity led to a qualitative change other than things just not arriving and stuff breaking down.
0:06:15.7 SC: Yeah.
0:06:16.1 CM: I think that the systems were, initially in the pandemic, really performing as designed and at capacity, and so you had a lot of these… Supply chains have to be designed for their maximum throughput, which is peak season, which is like when everybody’s buying so much stuff for holidays or whatever. And because of when the pandemic hit, we were actually in the, what is traditionally the lowest point in terms of demand for the supply chain. So the supply chain was ready in that sense, but the challenge has come since, as that demand has ramped up. And honestly, understanding the scale of that demand and why we’re in this pickle that we’re in now, it requires a lot of macro-economics, [chuckle] because it requires appreciating that a few percentage points movement from consumption of services to consumption of goods, along with a bunch of changes in how we live and work, leads to demand that so far outstrips the capacity of global supply chains that you get what we’re in the middle of now.
0:07:27.3 SC: And what really struck me about reading the book, which I really like, is how much of the whole process that is required to get the computer that I’m talking to you on delivered to my house is invisible in some sense. We do take it for granted. And there’s a lot going on. Of course, it’s obvious that there’s a lot going on, but when you dig into it, it’s… You use the phrase “industrial ecology” when we were emailing about this, and it’s extremely apt because it’s not entirely or even mostly planned from the top-down, right? It’s sort of a million different networks have to work together and they arise in some somewhat organic way.
0:08:07.8 CM: Yeah, I’m currently just loving the dickens out of the audio book of Merlin Mann’s “Entangled Life”, which is about fungi and how we rely on them, and he studied the ecology of these fungi in tropical rainforests where they are part of what is known as the Wood Wide Web, and they are communicating what are analogous to impulses in our nervous system between tree’s messages, also obviously transporting a lot of nutrients. And the global supply chain is a lot like the network of mycorrhiza that are underneath our feet, in which 90% of all plants depend on, in that, yeah, it’s not top-down, the different segments communicate with each other at the point of a port or a warehouse or a truck, as goods are moved from one to the other. But each one of them is kind of self-contained, and it is also a distinct marketplace. There’s nobody who’s cornered the market on ocean shipping, or trucking, or even e-commerce, as big as Amazon is.
0:09:19.7 CM: So every single one of these is a very complicated marketplace where the price of everything is constantly changing. Obviously people buy contracts for long-term shipping, like I want so many shipping containers on this ship six months from now or whatever, but a lot of it is the so-called spot market, and that’s what’s been going crazy because this ecology is just getting overwhelmed. And so, of course, economics, it’s also a social science, the result is that prices go crazy or there are shortages.
0:09:52.2 SC: And there’s so many different parts of this. I guess I wanna start with my favorite part, which is the shipping and the transport part. You mentioned right at the beginning of the book, something that is apparently a cliché or a standard story in your world, which I had not known about the fish, if you fish some salmon off of the coast of Scotland, maybe it’s salmon, maybe it’s some other kind of fish, and then you buy it in a…
0:10:18.5 CM: Cod, yes.
0:10:18.6 SC: Cod, and then you buy it in a supermarket in Scotland, unbeknownst to you, it’s visited China in-between when it was caught and when it arrived in your supermarket.
0:10:25.9 CM: Yes, it was frozen, it went to China, it was filleted, and then it’s shipped back in that same cold chain to Scotland, because the cost of labor is so much lower there. So it’s like this 20,000-mile journey for your cod or whatever that was caught very nearby. I think that that shows the absurdity of global supply chains. I mean, is it absurd or is it just really efficient?
0:10:54.5 SC: Yeah.
0:10:54.8 CM: Before the pandemic, there was enough capacity that it costs $2 to send a flat screen TV from a port in China to the port of Los Angeles in the United States. Now, obviously, it only costs $2 because it’s stuffed with hundreds of other flat screen for TVs in a big shipping container. But what that cost doesn’t reflect, of course, are all the externalities, all of the fossil fuels, all of the labor, which some of the workers in that supply chain are working under less than ideal circumstances. But it’s kind of like, we’ve got the science, so let’s do it, we have the technology. And of course, now we’re in a very different place where the cost of shipping that television is gonna be 10 times what it was before. So it may no longer be profitable to fillet that cod in China and the short-term result is, well, maybe there’s no filleted cod in your supermarket in Scotland. There’s all kinds of shortages happening in the UK now because of a trucker shortage. The long term is maybe people start to relocalize, or as they say, reshore those supply chains. It would certainly be less absurd from an energy expended perspective.
0:12:14.7 SC: What exactly are you referring to when you say that it will soon be 10 times as expensive to do that shipping?
0:12:20.5 CM: It is 10 times as expensive now. The spot market for a shipping container, if you wanted to transport a shipping container from one of the biggest ports in China across the Pacific to a West Coast port in the US, usually it’s the port of LA, Long Beach, which is the biggest port in the United States. In the before times, it would cost you maybe $2,000. Now on the spot market, it’ll cost you $16,000, $20,000. It’s so expensive that a lot of shippers have just thrown up their hands and said, “Forget it. Let’s just put it on an airplane.” But the problem is, because there’s so much less international travel, a lot of that airplane shipping was just in the spare capacity in the belly of passenger jets, so people are really stuck.
0:13:07.8 SC: But what is the reason for this growth in cost? Is that the pandemic or something else?
0:13:12.4 CM: So this is the thing that is difficult to appreciate. What we have, as much as anything, as much as we have a supply of shipping crunch, we have an explosion in demand for shipping. This is because lockdowns led so many more of us to buy things via e-commerce, e-commerce supply chains are biased towards things coming from China and East Asia, and South Asia, and Southeast Asia. And in addition, there was this thing that happened where at the beginning of the pandemic, shippers, truckers, et cetera, companies canceled their orders, because what they thought was gonna happen in the beginning of the pandemic was a sequel to the great recession, where Lehman Brothers collapsed and all that. So everybody thought, “Oh God, we’re gonna have this huge recession, so let’s pull back our orders, let’s not book any more shipping containers and trucks and whatnot.” But instead what happened was you saw this huge surge in demand. And a big part of this is people just stopped going out, so then they just started buying stuff.
0:14:16.6 SC: Yeah.
0:14:17.6 CM: Another part is, obviously, all those stimmies, those stimulus checks helped. But I really think what happened, more than anything else, and this comes from recent reporting I’ve been doing, talking to economists and stuff, people have changed their lives more than we appreciate. So the Bureau of Labor Statistics says that only maybe 14% of people are still working from home, but that could be an artifact of how they ask the question. If you look at it, there’s a Gallup data that came out yesterday which says that the number is more like twice that. So we may already be approaching the maximum number of people who are in jobs who can work from home or working home part of the time, and what that’s leading to is just this huge lifestyle change.
0:15:01.4 CM: So one sociologist wonk person called it family in-sourcing, and I think whether or not you have kids, we’ve all had the experience of being like, “You know what, I’mma do more stuff at home,” “I need a new set of knives,” “I need some outdoor furniture,” “I need a desk for my kid,” “I need a webcam.” And so that demand, and then the ability to do that spending because nobody’s going to Disneyland or whatever, has just shifted so much spending to goods, and those goods have to get into our country on shipping containers, and that whole system is not designed to ramp up quickly. And it’s impossible to ramp it up quickly, because what are you gonna do? Are you gonna put in another order for another ocean-going ship that’s literally three football fields long and 15 stories tall?
0:15:50.0 CM: Okay, great. Well, Hyundai-heavy industries will get you that ship right away in four years. So that’s a big part of the problem.
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0:15:58.6 SC: Okay, cool. So it’s just supply and demand in the pandemic and this shift in lifestyle, which as you note, might not go back. I think, just to sort of put things in context here, over the course of this conversation, we’ll be bumping into various horrific aspects of this whole supply chain, but we do as consumers benefit from it. Like you said, we buy stuff. I mean not only the obvious stuff, but I did upgrade my kitchen utensils during the pandemic ’cause I was using them a lot more frequently, right? That kind of thing goes invisible, but it can definitely lead to a lot more demand.
0:16:32.8 CM: Yes. Economists call this multiplexing, when one good can be used over and over again, and it’s just much more efficient use of that good. And when we were all going to offices and sharing a coffeemaker, we were multiplexing that coffeemaker. Well, now that we’re all at home, well…
0:16:50.6 SC: Yeah, we all need coffeemakers. [chuckle]
0:16:50.9 CM: That means 60 new coffeemakers got ordered or whatever [chuckle] for everyone that used to be in the office.
0:16:57.7 SC: We all had this experience during the pandemic of watching on tenterhooks the drama in the Suez Canal with the Ever Given ship being stuck. And when that happened, it sent me on a little bit of a trip down the rabbit hole concerning containerization. And this is something that I just become absolutely fascinated with. I could have a whole podcast conversation about containerization, but we’ll try to get other things first. But the very idea, which I’m sure I knew but hadn’t quite appreciated, that those boxes, those containers that are on the ships are the same boxes that are being pulled by trucks, right? It’s literally exactly the same box. You pick it from the ship, put it on the truck, put it on the train. And this is not automatic or natural. It happened, starting in the 1950s, and it changed everything. And the word “container” is not just a box containing things, it’s a very specific kind of container, these intermodal things that go on ships and everything. So put it into your own words a little bit about how that did change the whole supply chain that we rely on.
0:18:07.7 CM: Yeah, I think containerization, it’s actually a much deeper phenomena because this is also how the Internet works. The Internet, the underlying protocol, it turns data into discrete packets that then are all handled the same right? So any time you wanna create a system, whether it’s the Internet or a network of fungi in the forest or a shipping network, you want to containerized things, so you have a standard thing that all the different modes of transport can handle, and that’s called intermodal, right? So a shipping container can go on a truck, on a ship, on a train, and all of the cranes can be standardized, et cetera. It’s like any other standard, like the plug in your wall, if every electrical plug in every house was putting out a different voltage, our modern world wouldn’t work. So that standard came about, as you said, starting in the ’50s, really in the ’60s it picked up, because there’s this guy named Malcom McLean, there’s an amazing book about him by Mark Levin called “The Box”.
0:19:20.0 CM: And he just had this vision. Let’s stick stuff in containers that can travel between ships and trucks primarily, and everybody was like, Okay, we kind of agree with you, and we’ve experimented with this a little bit here and there, but we have a different standard. These are different dimensions of a box that we want and ultimately he won, in no small part, because the United States government needed to move an enormous amount of material into Vietnam for the Vietnam War. So he got that contract and they were like, Cool, we’ll use your shipping containers. It gave him enough kind of start-up capital to build ships that were designed just to handle shipping containers of a specific size that could then be unloaded by cranes of a standard size. And then before you know it, those cranes were being installed in ports all over the US, and then eventually the world. And then what happened was, people examined the throughput of these ports, and it was so much higher than the old way. Because the old way was you have a bunch of barrels and sacks and God knows what else, and then an army of men has to go into the hold of that ship and haul it out. Usually it used to take like two weeks to unload a ship. A containerized ship, even a big one, they can unload it in 24 hours.
0:20:46.2 SC: Yeah. And a big one is really, really big. [chuckle]
0:20:49.2 CM: Enormous. 10,000 40-foot containers on the biggest of ships. I said this earlier, but it bears repeating. Three football fields long, 15 stories tall. When you are next to one of these, as I’ve been both on the water and on land, it really, really feels like when you stand on a long block in New York City or Chicago or some place like that, and you’re just looking up at these kind of hulking buildings and there’s a whole block of them because it’s as big as the… They’re literally as big as the Empire State Building, laid on its side, and that is the most efficient way to move atoms, mass on the surface of the earth that we’ve ever invented because of all the fun Newtonian physics of water and all the rest.
0:21:34.6 SC: Well, and what’s interesting, one of the many things that are interesting to me about this is that there needed to be some kind of phase transition. It’s easy for everyone to individually load their sacks of grain onto a ship, but for the world to agree, we’re gonna use this kind of standardized container, they might all agree that if we all did that, it would be great, but someone has to do it first. And there it’s very expensive when you first do it, and basically, like you say, it was this one guy, Malcom McLean, he just really pushed forward, he was at the right place at the right time with the Vietnam War contract, and that changed the world.
0:22:08.5 CM: Yeah, I mean it’s such a great argument in favor of standards and open standards. It’s on a par with Tim Berners-Lee and the World Wide Web and each team out and being like, Let’s all agree that this is the standard. This is how we’re gonna render web pages, and everybody gets to use this, and then we can all interface with each other and then boom, globalization.
0:22:30.2 SC: And the magic of the container is it gets loaded… I’m stating this as a statement, but correct me if I’m wrong here. It gets loaded in Vietnam or wherever, and then it might not be opened or unloaded until it arrives at some factory or some facility in Utah or whatever. It just travels across the world, and who knows what’s inside. Someone knows what’s inside, but the people who load it don’t need to know.
0:22:55.7 CM: Yeah, the only wrinkle I would add is that a lot of those containers, unless they’re traveling on a train, because trains are so, so efficient will actually be unloaded, not that far from the port, and then all the contents will be put into the back of a semi-trailer, and the reason that happens is containers are heavy because they have to withstand traveling across the ocean, so for that reason, just to save on fuel and all the rest, a lot of containers get emptied in these vast warehouses that are kind of invisible to us, in California’s Inland Empire, let’s say.
0:23:39.0 SC: Okay.
0:23:43.5 CM: And the materials cross-docked, as it’s put, into the back of a long haul truck group, because the semi-trailer is super lightweight, it’s very thin. It’s strong because it’s got a metal frame, but it’s very, very, very thin and lightweight.
0:23:58.5 SC: Yeah, so I feel like when I’m driving around LA, I’m at the center of global commerce sometimes, and I’ve noticed since I became fascinated by these containers that some trucks are clearly containers, and some are not, and what you’re telling us is that there is sort of an economy to only actually lugging the intermodal container a short way before you distribute it to more efficient ground transportation system.
0:24:25.4 CM: Yeah, yeah, exactly. And again, the exception of that is trains and we shouldn’t forget that by ton mile, we move almost as much material in the US by train as we do by truck, it just tends to be different stuff, it’s like commodities or frankly, a lot of it’s coal. But yeah, a lot of that stuff, it gets put into a different kind of box when it goes on the back of a truck.
0:24:50.7 SC: And is there some feeling for the most important or popular trade routes and the most important kinds of cargo. Obviously, it’s everything in some sense, but is it dominated by a small number or is it really just this network that every big city has a port and it connects with every other big city.
0:25:10.6 CM: Well, this is the thing that’s interesting about containers and containerized shipping is that it exactly maps to the pattern of global trade. So we have a big trade deficit with China, we buy way more from them than they buy from us, but what does that actually look like? Well, the physical reality of it is shipping containers worth of goods. That’s why so many full containers cross the ocean from these giant ports in China. I think the seven biggest ports in the world are all in China. Across the Pacific to the port of LA Long Beach. They can also go to Oakland or ports in Canada and places like that. Or they might go around and go to Savannah. But then one of the challenges we have right now with global shipping is that what we’re selling back to China is a lot of it’s like intellectual property, and software…
0:26:07.7 SC: Movies.
0:26:09.9 CM: And cloud services, things that do not need to go into shipping containers, so then the problem is, Well, you got all these empty shipping containers like who’s gonna ship them back, and remember we talked about earlier, there’s no top-down authority, that’s like I wave my fiat wand and say all these empty shipping containers need to go back on another route. They take a kind of more tortured route back to China, and so that’s why there’s this imbalance. Just as we have a trade imbalance, there’s this imbalance of containers and people are like, Oh crap, we don’t have enough containers. And China is like, Oh crap, we’re making containers as fast as we can. But there is this terrible inefficiency in the system where it’s like we have a lot of containers. They’re in the wrong place, like somebody’s gotta figure out to get these back and we have ways to get them back, it’s just that those are broken like so many other parts of the supply chain.
0:26:55.2 SC: And is there a simple way of characterizing the sense in which China is the center of a lot of this is that there… I mean, our T-shirts and everything say, Made in China, but is that just because labor is cheaper? Is it going to continue that way? My feeling is that China is trying to sort of upgrade their job force to go from mindless labor to other kinds of things, so is it a temporary thing where all these things are made in China and soon they’ll be made elsewhere.
0:27:25.5 CM: So it started because China had cheap labor, but also it’s just a big centrally controlled economy where the Communist Party can just sort of dictate, well, we’re gonna prop up this industry or we’re gonna build these kind of factories or whatever. But even as wages rise in China, there is a stickiness to things still being made there because it requires expertise to make many things in our modern world. They’re very, very complicated. So even if manufacturers would like to move the manufacturer of, say, consumer electronics from China to Southeast Asia or even South Asia, they have to do it one piece at a time, starting with the least complicated part of that process, which usually is the assembly by hand of the iPhone or the Samsung phone or the air pods at the end of that manufacturing process. But those microchips and other tricky to make components, they may still be made in China and then shipped over there because that’s where the expertise is. Right?
0:28:41.5 CM: And the funny thing is that expertise, it’s like water or something, it sort of accumulates in these unexpected places. It turns out that Malaysia is where the world’s microchips are packaged. And packaging a microchip means taking that silicon chip and putting into the little thing that you’ve seen when you’ve busted it up in an old computer where it looks like a bug and it’s black and has little legs which are the electrical connections. Chip packaging is really important. That’s done in Malaysia. Malaysia had a bunch of shutdowns recently, so it caused another kind of mini chip shortage, not because there weren’t enough chips, but because there wasn’t enough capacity to package them in Malaysia. So what ends up happening is, even as China is trying to move up the scale of development to more like software engineering or whatever else, production of cultural capital, whatever it is that the US is doing, there is that stickiness and it tends to have this effect of just lengthening supply chains and making them even more complicated and more vulnerable. It’s a bit comical. That’s not the only effect it has, because people who do logistics for a living get wise to this and are like, Hmm, we really should spend the extra money required to vertically integrate this all on our shores.
0:30:10.3 SC: But do you make them…
0:30:12.0 CM: But that’s been the near term effect.
0:30:13.4 SC: It’s a very interesting point, the combination of the fact that expertise pools in certain geographic locations, plus the fact that shipping is relatively cheap. Right? That’s the lesson of the cod from Scotland. Creates this absolutely Byzantine network that I think that we’re not usually aware of of how many trips the individual pieces of something have to make. It’s built somewhere, packaged somewhere else, put in a cardboard and plastic container somewhere else, et cetera, before it gets to us. It’s just cheaper to do things in different parts of the world than to build, I don’t know, a factory or whatever it is, a facility locally. The shipping is the easy part.
0:30:53.7 CM: Yeah, and there’s so many fascinating examples of that. The more complicated the object, the more of those dependencies it has. One of my favorite examples is like, Okay, let’s say you wanna build the CPU of a smartphone or whatever. Okay, starting point, if we’re not gonna go back to the birth of the universe, is ultra pure quartz sand in of all places, Appalachia. Now that quartz sand is gonna get transported somewhere where it can be melted down and burned into a crystal. That could be Australia. Now, that incredibly pure crystal of silicon is gonna be transported elsewhere. It could be another country, but let’s just say it goes to Taiwan, and then the crystal is sliced into wafers, and then TSMC Fabs in Taiwan, it’s etched. Now, those chips are broken up, and as we just discussed, they’re package in Malaysia, and then they’re gonna get transported to Shenzhen, where finally they’re gonna get stuck into a phone. That is the trip, just to get this thing assembled. Oh, and by the way, it might then travel from Shenzhen to India ’cause so much phone assembly is being done there or in Vietnam, and then it’s going across the region back to us.
0:32:16.1 CM: So just to imagine if you were trying to design the most Rube Goldbergian and the most vulnerable to trade wars, actual wars, global pandemics, I mean, honestly, it is a miracle that we haven’t run out of everything by now, when you think about it. It shows that there is a lot of flexibility and elasticity in these markets.
0:32:40.2 SC: Yeah, but it does seem very fragile in a way, that’s the difference, I guess, with a biological network, a biological network like you compared it to the fungi, et cetera, or the networks in our bodies, but they’re sort of evolved to be resilient because whatever kind of redundancy that is useful to survive a little bit longer, might be selected by natural selection. Whereas here this is one global supply chain, and you can imagine they’re critical points where it could break down catastrophically.
0:33:12.7 CM: Yeah, you’re a student of evolution, you know that one of the major reasons that we think species go extinct is that they over-specialize and then the ecosystem changes, and then it’s like boom, adios. You’re the dinosaurs, the asteroid just arrived, see you later. And then the weed species of the world kind of take over. So yeah, I think that this whole system is in a place now where people are recognizing these vulnerabilities, like the Tim Cooks of the world have woken up and that’s why, to go back to microchips, you have Intel and others being like, We’re gonna spend, I forget the figures, tens of billions of dollars to build more fabrication capacity in the US. TSMC, they make almost all the high-end chips that we all rely on, they’re building a new fabrication plant in Japan, they just announced. Interestingly, that plant is not for the latest generation of chips, it’s for the old chips that the automakers need and can’t get enough of. So people are kind of saying, Oh, this needs to be more resilient. And the one way that you build resilience, of course, is redundancy.
0:34:21.8 SC: Okay, let’s switch to something you already mentioned very briefly, but clearly is an overarching theme in the book, which is a time, saving time, making things happen as quickly as possible. And you mentioned the chaos, not the chaos, but the activity at a port, like Long Beach or LA or Shenzhen or whatever. And it’s kind of awesome to behold to see these pictures of what looks like acres of shipping containers lying on the ground. And I read an interesting statistic here that the average time to unload a container from a ship in North America is 76 seconds, in Northern Europe it’s 46 seconds, and in Asia it’s 27 seconds. So I thought 76 seconds was pretty good, but they’re even much faster in Asia. So it reminds me a little bit of trying to get to a sports stadium for the big event, or trying to park at an airport where you have many, many people trying to converge in a tiny place, and there must be both science and engineering that goes into figuring out the most optimal way to get this stuff to happen.
0:35:27.2 CM: Yeah, and there’s a lot of fun math which I think you probably enjoy. It goes back to, I think it was Claude Shannon and having the problem of figuring out how many… I forget the name, the people who use the direct phone calls in the old days…
0:35:56.6 SC: Operators. Yeah. Switchboard operators.
0:36:00.5 CM: Operators. How many switchboard operators do you need so that X number of people in a town will be able to connect 90% of the time, and that turns out to be this really interesting mathematicorum and that kind of math, which among other things, led to so-called queuing theory, which is literally the math of waiting in lines, is absolutely integral to the entire switching because everywhere you go in the supply chain, everybody’s waiting in a line. Your ship waiting off the shore to get in. And then once you pull these containers off as quickly as possible, and maybe you’re using robots to help you do that faster. Now you have a whole new queue. Every terminal in a port is just a big messy three-dimensional line queue, where containers are stacked on top of each other and they’re moved around, and they need to be in the right place, which is on top of a stack, not that far from the far side of the terminal at the moment that a truck pulls up to grab that container and then cart it off to a warehouse. And the thing is, if you fully unloaded a modern container ship… I did the math, it’s in the book, and I can’t remember exactly the math, but if you fully unloaded a modern container ship and you allow a reasonable distance between the trucks doing it, the line of trucks would be like 50 miles long. That’s the length of your queue from one ship.
0:37:27.6 SC: Per ship.
0:37:30.3 CM: And so now you can see the sort of challenge of making this work and you can also see the value of why so many ports are turning to automation to do things like groom the yard of containers, which just means rearranging them continuously with these big robots, so that the containers are kind of moving through, with the least number of total moves, smoothly from where they’re pulled off the ship to where they’re put onto a truck. And that’s just one of the queuing problems, and there’s queuing problems throughout the whole thing.
0:38:02.9 SC: And it’s nevertheless a interplay of human judgment and automation. You have this fascinating story of just piloting the ship into the port. There needs to be a highly paid ship pilot who is local to the port, who goes on a little tug boat or whatever, climbs onto this big container ship and then pilots it in.
0:38:25.9 CM: Yes. I mean, the harbor pilot thing blew me away because the simplest way to put this is that for 90% of the stuff that you own, which comes on ships, 90% of everything, as Rose George’s book is called, someone had to risk their life at least at that one moment to get it to you. And what I mean is that to transfer the specialized pilot who knows how to navigate that giant ship into the very tight confines of a port, that person had to motor out to that giant container ship on what’s called a pilot boat, and then because the pilot boat’s so tiny and the ship is so big, and there’s this ocean swell happening, they have to time it just right where the two ships are moving up and down with a different period and kind of nimbly hop from the deck of the pilot boat onto what to this day is still a rope ladder, and then they gotta scramble up the rope ladder before the swell of the ocean catches them because if they get sucked under, their survival rate is zero. So over the course of a harbor pilot’s career, there’s a one in 20 chance that they’ll die on the job.
0:39:33.7 SC: Wow.
0:39:34.2 CM: And these are not people who are disposable, in any sense. I mean no human life is disposable, but in terms of their expertise, because these are the most experienced pilots in the world. They have to be an ocean-going pilot for years and years generally, and then they have to pass this insane test that’s like the test that cabbies have to pass in London to become cab drivers, the knowledge, where they literally fill out by hand a giant paper map of the port that they’re gonna be harbor piloting in, and it takes them like six hours to write in all the features and the depths and the hazards. So the things that they do, in terms of steering this boat, are just unreal because it’s something with the mass of a skyscraper, and the tolerances as they go under a bridge, or the tolerance between the bottom of the ship and the bottom of the ship channel could be like a meter, and then they’ve gotta get it right by the key side to within meter or two of where it’s supposed to land, between two other ships that they don’t wanna crash into, so that the electricity and the fuel can be hooked up properly. So it’s just crazy. It’s like stunt driving, but with a skyscraper.
0:40:40.5 SC: And it doesn’t seem like the most rationally designed system of the world. Are ports constantly being reinvented to be better, or are they just sort of scrambling as fast as they can to keep up with the changing global supply chain?
0:40:58.5 CM: I think that there is an element of scramble, but the thing is that ports are public infrastructure. So it’s not like Amazon is like, “Oh, we need a bigger port.” I mean we might get there. [chuckle] But what happens is you get billions of dollars of public investment by, let’s say the state of California in this case, or the cities, because they know that they’re going to recoup it because of taxes and economic activity. But that kind of investment and expansion takes decades in order to make these… The challenge they have now is that because it’s more efficient and cheaper for the ocean shippers, these container ships have just gotten bigger and bigger and bigger, and now they’re really at the limit of what these ports can handle.
0:41:45.0 SC: I could talk about the shipping and the containerization forever, so like I said, but we should shift gears a little bit to the manufacturing side of things. And as you point out in the book, the issues that were always there in the factories, on the manufacturing side of things, are now there at the opposite end of the supply chain in the fulfillment centers. It’s full circle kind of operation. But tell us about Frederick Winslow Taylor. Because here’s another thing where if you’re in the business, this is just like he’s super famous. Everyone knows him. It’s like, who’s Einstein? But if you’re not in the business, you’ve never heard of this guy.
0:42:22.9 CM: Yeah, Frederick Winslow Taylor, he’s like Karl Marx is to communism, I think Taylor is to modern technological industrial capitalism. But his name is not familiar because his ideas have become the water that we swim in. He was really the first management consultant, and he invented this whole idea of time and motion studies and speeding up the labor of people who are in jobs that involve a lot of routine, like manufacturing. That’s where he started. And of course, it should be stated that this was one of these moments in history of dual discovery, like Newton and Leibniz, both coming up with calculus around the same time, because at the same time that Taylor came up with all of his ideas, Henry Ford and his team was coming up with the same ideas in order to get employees to be able to keep up with the pace of the assembly line, which he had just invented, or borrowed really from slaughter houses.
0:43:20.9 CM: So Taylor-ism is just this idea that you can break down a job into these minute tasks, time every single one of them, and come up with better ways to do it, and what it leads to is the speed-up of work. And the way that Taylor-ism was implemented back at the beginning of the 20th century, workers found it so brutal that at the Watertown Armory where it was implemented by the US government, a bunch of them went on strike, and then there were congressional hearings, and Congress declared that Taylor-ism could never again be used anywhere in a federal facility. Which is ironic, because again, now it’s kind of like the way that everything is run.
0:44:00.5 CM: The modern day version of it, I call Bezos-ism, Bezos-ism is just what happens in Amazon fulfillment centers. Taylor-ism is the ideology of Taylor-ism, kind of carried down to us or a bunch of other management consultants combined with very sophisticated systems for observing in real-time, every single thing a person does, technological surveillance. And then once you have that data, you can manage people by algorithm, right? So if somebody falls behind in an Amazon Fulfillment Center, it’s not their boss who’s like, “Hey, work faster,” back in the days of Taylor, it’s an algorithm, and it just says, “Hey, you spent too much time off task,” or it says, “Hey, this is your third warning, in two weeks, this algorithm is gonna write you up and then you’re gonna go talk to your human manager.” So management by algorithm, obviously you see that everywhere now. You see it in the way that shifts are scheduled at fast food restaurants, the way that the pace of work is regulated at fast food restaurants, the way the pace of work is regulated at call centers. Obviously, the way Amazon fulfillment centers are run. And part of the kind of great resignation we’re seeing now, I think, is people rebelling against that style of work. Because everybody has a bad day, but if your manager is an algorithm, there’s no button you can press on your app to be like, “I’m having a bad day, give me a break.”
[chuckle]
0:45:22.2 SC: Well, that’s what’s so crucial about this moment when Taylor comes along. I mean I think that you’re right. The impression I got from reading your book is that Henry Ford obviously played a huge role here, but the most striking thing about Taylor’s way of doing things was rather than just telling workers, “Okay, this is your task, now do it,” and even more than just saying, “Do it fast or we’ll fire you,” or whatever, it was this observation of looking at different workers doing it different ways, figuring out what was the most efficient way, and then not just telling the workers to do it, but do it in this exact way with this exact sequence of movements. So on the one hand, it makes things a lot more productive, efficient. On the other hand, it does leech the humanity out of the human being that is actually doing this task.
0:46:10.6 CM: Yeah, everything depends on how much agency that worker has. So I had a really interesting conversation with sociologists and labor economists, and they pointed out that there are industries, like automobile manufacturing, where obviously workers are unionized, so they have a lot of say over how their work is done, where those workers, when sort of presented with, “Hey, here’s a way to make your work more efficient, what do you think about that?” and they can push back on it and be like, “Well, this part isn’t safe, or this part isn’t sustainable,” telling people, “Hey, let’s make work more efficient and safer and more humane”, most people will sign up for that. But when workers have no agency, then what can happen is what we’ve seen in Amazon’s warehouses where the pace of work and the repetitive nature of the work, which is directly a product of the automation that’s being incorporated into that work, leads to things like so-called musculoskeletal disorders, ie, carpal tunnel syndrome, whatever, because the human body was not designed to do this exact same action. I know your viewers can’t see it, but I’m picking objects off of the shelf, in an Amazon warehouse as quickly as I can, and repeat that action over and over and over again. We all know anybody who’s done any athletic activity that your joints are gonna give out if you do the exact same thing over and over again for 10 hours a day of every work day.
0:47:37.3 SC: Well, you mentioned the fact that there is a correlation between increasing automation in these centers and increasing injury rates in the centers for the human beings who are still there. I mean, is part of that just that we’re in a transitional time and we haven’t yet figured out, or the bosses haven’t yet figured out that it’s important to keep your employees healthy, and so let them vary their routines or vary their tasks or something, or is it just, we’re gonna dispose of these human beings eventually, so who cares?
0:48:04.1 CM: I think that Amazon has been in such high growth mode for so long that the people in charge, whether it was a conscious decision or not, have been like, “Okay, if we’re gonna make this business big and profitable, this is the pace of work that we need to set.” And I think the challenge that Amazon has now is they’re bigger, they’re more mature, there’s more scrutiny, but just as importantly, the labor market is starting to do its job. Economics is working in that there are so many fulfillment centers, Amazon has such a high demand for workers, everyone does now because there’s a labor shortage especially for blue collar workers, that raising wages is no longer enough. If you have a 100% turnover per year which is not at all atypical for these warehouses, you need to figure out how to hold on to those workers longer, and when every time your workers organize, they’re telling you, “Our issue’s not benefits and wages, those are fine. Thank you, Jeff Bezos. Our issue is working conditions.” At some point, they have to listen, otherwise they just cannot run their business because they just can’t recruit and retain. They can’t recruit workers fast enough and they can’t retain them long enough, because there’s only so many human beings of working age in an economy. That’s just the way it works.
0:49:20.6 SC: Well a big part of it… We should talk about the concept of de-skilling labor. I don’t know if this goes back to Taylor or whoever, but the idea that we want to take the trickiest parts of the manufacturing process and give those to the robots, to the computers and whatever, as much as we can. The loom makes it much easier for weaving to be done by unskilled laborers. And so you figure, “Well, now I can just replace my workers with anyone if the parts that they have to do are very simple.” But There’s still, like you say, a bottleneck with a number of people that exist.
0:49:53.6 CM: Yeah, de-skilling has been integral to the expansion of Amazon and countless other businesses. Our fast food industry is built on this idea that you don’t need a skilled fry cook to make a burger because this automated grill is doing it for you. So de-skilling is essentially when you take the knowledge of the human, you embody it in a machine, a piece of automation, it doesn’t have to be a very smart piece of automation, but it is skilled in the sense that it can do a job that before might have been tricky. I like that you mentioned looms, ’cause that goes all the way back to the Luddites and Ned Ludd wanting to smash the automatic looms ’cause they were taking away the jobs of the weavers. But when you de-skill a task, you make it very easy to recruit new workers which gives you less incentive to retain them. So if Amazon can train a new Amazon warehouse worker in a day or less, then turnover doesn’t become a problem until they run out of new people to recruit.
[chuckle]
0:50:54.4 SC: We skipped over from sort of Frederick Winslow Taylor to Jeff Bezos. But in between, there’s this whole kind of fascinating culture of scientific management strategies, the Toyota way, Kaizen, lean manufacturing. And how much of these are really insightful ways to get manufacturing done, and how many of them are sort of management fads?
0:51:21.2 CM: Yeah, it’s difficult to say because so much depends on how they’re applied. Obviously, when Toyota came up with their Toyota production system, that is the reason that Toyota took over the global, and especially, the US auto market. By the same token, Jack Welch at GE came up with this whole idea of Six Sigma, which just means statistically reducing the error in your manufacturing process till it’s like not even there anymore. And a lot of that, or maybe all of it, really derive from, yeah, this early kind of ideology of management consulting. Because even though Taylor, he wrote this book Scientific Management, he wasn’t so successful as an individual at getting companies to adopt this, but his acolytes, which included the Gilbreths, who then had a dozen kids, and then there’s a Disney movie called Cheaper By The Dozen, ’cause they’re applying the lessons of scientific management to managing a household, really spread this idea around. So it is this idea that just kinda gets expanded on. Because in some sense, if you’re, especially manufacturing, if you adhere to these dictates and these strategies, you can make an almost defect-free product consistently, which is the goal of manufacturing, rather than having to rework it at the end, like Tesla in the early days.
0:52:56.9 CM: So it does work, and it does get implemented differently all over the world. So the Toyota production system, obviously, Japan is a completely different cultural milieu than the US, because at the time the Toyota production system is being ramped up, it’s a culture of life-long employment. It’s this deep relationship between the employee and the employer, so there it’s more about like, “Let’s empower the worker.” If the worker sees something wrong, they get to pull their little Andon flag and say like, “Hey, something’s messed up here.” That exact sort of idea, set of ideas, got imported into Amazon by some executives who I talked to in the book, but it got mutated in some ways and became Bezos-ism. They took out the worker empowerment and just put more surveillance.
0:53:48.1 SC: Well, and it’s not just the need for speed here, although that’s very important, but also the need for predictability. Like you said before, we don’t just want the average time to do something, to be low, but it better not have that much variability around it. And part of that optimization problem has helped us create this culture of just-in-time manufacturing, where you manufacture something and then basically ship it to a person rather than letting it sit in a warehouse for a long time. And again, that’s great for efficiency and productivity, a little worrisome when it comes to vulnerable points in the chain.
0:54:24.2 CM: Right. I mean it’s pretty straightforward, if you don’t have any extra inventory sitting around and there is a supply shock where you can’t get enough of something, or suddenly it takes you twice as long to get it across the ocean on a ship, then you’re screwed, you’re gonna run out.
[laughter]
0:54:45.3 SC: Okay. And then the final step. We’ve gotten our raw materials, we shipped them around the world, we’ve made a product, we’ve shipped it in a container, we send it to a fulfillment center, and now they’re sending it out. So there’s a whole nother step of getting the goods to people. And maybe we skipped over the trucking step where we get things from the port to the fulfillment center, but both that trucking step and then the delivery step, it’s just a whole nother invisible culture of human beings in the United States that you don’t paint a very rosy picture of the life of a delivery person or a trucker, I gotta say.
0:55:23.9 CM: Yeah. [chuckle] Yeah, I mean, truckers really… Whoof, I mean, I think what sums it up, there’s this amazing 2017 feature in The New York Times, and one of the truckers whom they interviewed said, “We feel like throw-away people.” And it’s an industry where we often hear about, “Oh, there’s a truck or shortage,” but the truth is there’s not a shortage of people who wanna get into trucking. There is a burnout and a retention crisis. There are three times as many people in the United States who have the kind of commercial driver’s license required to drive a truck as there are of working truck drivers. And it’s not ’cause they all retired and are having a nice life in the Lake of the Ozarks now, it’s ’cause they burned out or they didn’t even last two weeks and they’re like, “This job sucks. I’m getting out of here.”
0:56:16.4 CM: And frankly, I don’t think truckers get very good representation in Congress because the big lobbying body there, it’s called the American Trucking Association, it represents these really big carriers, but they don’t even represent the majority of the trucking industry. Most of the trucking industry is like individual owner-operators, small trucking companies. They have their own lobbying body that somehow doesn’t get quoted very often. So truckers, they are…
0:56:46.0 CM: Here’s the typical wave of a trucker. They’re on the road 21 days out of every month, that means they’re nowhere near home or their family. They’re working 14 hours a day. 14 hours a day, is because the federal government limits them to 14 hours a day. It used to be more. They’re getting paid by the mile, so if they’re sitting at a warehouse where they have no control over how fast their truck is being loaded or unloaded, they’re not getting paid for that time. There may not be a place for them to sleep at night because there’s not enough berths at truck stops and rest stops, so they might have to illegally park down the side of the highway. You see this, once you know that this is a thing, you see it all the time, you’re like, “Why is that truck just parked on the on-ramp or the off-ramp?” It’s because that poor truck driver couldn’t find anywhere else to sleep.
0:57:27.6 SC: And also, by the way, because many people don’t know this when you say find a place to sleep, you’re not talking about a hotel. They sleep in the truck. It’s just a matter of where to park the truck while you’re sleeping.
0:57:39.0 CM: Yes. And on top of that, I think there’s this impression like, “Oh, drive a truck. I can drive, I can do that.”
0:57:47.3 SC: No.
0:57:48.6 CM: No, it is a skilled job to not kill yourself and other people, because the physics of a fully loaded truck mean that it’s gonna take you a football field or two to stop. And you may be driving in inclement weather and the whole time you’re trying to rush, rush, rush, ’cause you’re trying to get to that next destination in time or before your federally regulated time on the road runs out. Meanwhile, you and your boss and/or your freight company like CH Robinson is trying to find you your next load to pick up along the way, because you’re kind of just like most of these truckers are kinda just freelancers and they’re just bouncing from point to point, and that’s the life of an independent trucker. If you are a trucker driving for one of these big carriers and you’re new to the industry, it’s really like indentured servitude. You may owe them for the training that you got to become a truck driver, and so you’ve got at least a year contract with them that you can’t get out of, and you’re working like 80 hours a week and you’re making $45,000 a year, and you never see your family.
0:58:57.1 SC: Well, one impact that your book has had on my life is that I’m going to definitely think more carefully about changing lanes in front of a truck on the highway, because clearly, like you say, the physics of it is complex. And I get the impression that truckers are constantly being annoyed because they try to leave some space in between their truck and the car in front of them, so it’s just begging for people to cut in front of them, but that’s very, very dangerous apparently.
0:59:26.4 CM: It is. It’s the worst thing. Never cut in front of a truck. Don’t pass a truck, until they’re at least a couple hundred feet behind you, is what I would say.
0:59:36.3 SC: And when you talk about the number of hours that they’re working per day, and that’s regulated by the government, and they can’t cheat because they’re being monitored. It’s in this surveillance state, this Michel Foucault kind of thing where we’re keeping track with GPS or whatever of exactly how long they’re on the road every day.
0:59:55.6 CM: Yeah, the same management, the same intensive monitoring by technology and management by algorithm that you find in Amazon’s warehouses, you find a different form of it for truck drivers. So yeah, there’s GPS, there’s this little computer that is tracking their time. And look, it got put in place for reasons that are good, which is that people are like, “Well, we don’t want truckers driving too long. That’s unsafe.” Fine, perfect, good. But the problem is, because truck drivers were used to the old system where they could fudge their records, maybe they get to a warehouse and somebody’s being slow about loading their truck, they’re gonna hop in the back and take a nap. Well, now that nap, still counts as their workday, so they’re under the same pressure to get loads from point A to point B just as quickly, but in a way they have less flexibility about how they do it.
1:00:48.6 SC: [chuckle] Yeah, like I said, it’s a sort of dispiriting kind of picture of our world. And the fact that you raise about the representation in Congress is an important one because part of the standard solution to some of these problems is, Yeah, there’s the ruthless efficiency of capitalism that is gonna squeeze everything it can out of these workers. And then that’s supposed to be ameliorated by the government setting some standards. Is there hope? Whether it’s in the Amazon fulfillment center in the trucking industry for more humane working conditions being enforced by law.
1:01:24.2 CM: Well, in the Amazon warehouse, California just passed a bill that limits the quota systems that Amazon uses in its fulfillment centers. And Amazon can’t just pull out of California, so that’s gonna have a significant effect there. As for truckers, the only provision that I’m aware of that’s in the infrastructure bill, which may not pass anyway, came from the American Trucking Association, and get this, it is a request that they lower the age at which you can get a commercial driver’s license from 21 to 18. So the ATA is just like, “Hey, get us more cannon fodder,” also teenagers with their teenage brains are gonna be driving these enormous trucks on our roads. So yeah, that industry seems very fragmented, very dysfunctional. When you talk to people who really understand it deeply, they shake their heads and they’re like, “What are we gonna do?” And in the meantime, I am genuinely concerned that it will lead to problems in the supply chain that will affect us all. Because it’s true, by value of goods, it’s like 90+% of the value of goods that moves through America, it moves on trucks. Like that old phrase, If trucks stop, America stops. It’s true. If you can’t get it at your grocery store it’s probably ’cause they couldn’t find the trucker to deliver it.
1:02:49.1 SC: And there is this closely related part of the system, which is the individual deliveries. I don’t even know what the terminology we use here.
1:03:00.2 CM: The last mile delivery.
1:03:00.7 SC: The last mile.
1:03:00.8 CM: Yeah, UPS, FedEx and all that.
1:03:01.7 SC: Exactly, UPS, FedEx and also as you mentioned, companies like Amazon might just be building their own networks to do this. And you paint a very vivid picture of, once again, how much pressure there is on these drivers to be efficient, to move quickly and to get it done.
1:03:17.7 CM: Yeah, there’s tremendous pressure, and there’s a lot of variability in that industry in terms of how drivers are treated. If you look at a company like UPS, the company is more than 100 years old, it’s unionized. It’s a real no joke union, it’s the Teamsters. It is what academics call business unionism, where it’s not like the two are locked in battle all the time. The union makes concessions so that the business can continue to run and be profitable and everybody can have a job still. But it means that UPS is pretty conscientious about training their drivers to be safe, about helping them if they get into trouble with too many packages and such. And on the other end of the spectrum, you have… FedEx is all sub-contracted delivery companies, so none of their drivers are unionized. And then Amazon just copied FedEx’s model to build their own last mile delivery network. So when you see those big gray vans with the Amazon logo on the side, that is a local company. It’s like a franchisee almost.
1:04:20.1 SC: Okay.
1:04:20.5 CM: A local company that contracts with the Amazon and then, on the other end, hired a bunch of drivers. Amazon has recognized that the pressure to deliver so many packages so quickly has affected potentially the safety of those drivers. So their response, typical Amazon, was, “Let’s put more surveillance on the truck. Let’s put more cameras facing out and facing in.” So you can watch them be unsafe. The funny thing, when you talk to Amazon about this, whenever you ask them like, “Have you ever just considered lowering the pace of work? They’re like, “Nah.” That could just be bad messaging on their part. I think that in warehouses, they probably are doing that, lowering the pace of work sometimes, ’cause they can just… It’s just a little toggle on some engineers data port somewhere.
1:05:05.5 SC: Right. And algorithm. Yeah.
1:05:05.6 CM: Like fewer widgets. But it’s a lot of growing pains because it’s a company where… I don’t know if I would call it growth at all costs, but it’s just a very aggressive environment where it’s like everybody should perform at the highest level all the time, and if you can’t do it, we’re just gonna cut you from the team. And maybe that works when you’re kind of the upstart and you’re challenging the world’s retail giants and e-commerce is a small fraction of all of retail, but now that it is such a big proportion of it, and it’s like we all kind of live and work in the company store, the United States of Amazon. The way that people are employed has to be changed.
1:05:50.9 SC: I totally get the critique, but if I’m honest, I love Amazon, I use it all the time. I try to spread out my e-commerce and buy from independent bookstores and things like that, as well. But it’s just so convenient. Oh my goodness. How can you help, but buy from Amazon?
1:06:08.2 CM: Well, Matthew Yglesias the former founder of Vox and political commentator, he said something, which is funny, but I think true. He’s like, “Sometimes I wish that a company like Amazon would become so dominant because then it would be easier to regulate this very fragmented industry of supply chains.” And it’s like a fair point, ’cause trucking is super fragmented and that hasn’t helped those truck drivers at all. If Amazon had to own its entire trucking industry, if you have a sane democracy, like it could make setting out fair rules easier and more possible.
1:06:50.0 CM: And again, when I talk to Amazon workers, which I have with some frequency, they are not asking people to boycott the company like the Nabisco workers who are like, “Don’t buy Frosted mini-wheats” or whatever. They’re just like, “We want to highlight what’s going on because we want working conditions to improve.” So I don’t know that it’s about, “Amazon is evil and Amazon needs to be kicked to the curb.” I think it’s more like Amazon represents this new reality, which frankly has been copied by countless other companies, whether it’s Walmart or Target, or Lowes or everybody who’s moved into e-commerce and as a society, we need to take a hard look at what this means for workers and the environment and everything else, and make decisions, informed decisions about how we want to regulate that and when we don’t want to regulate it.
1:07:42.4 SC: Well, now that we’ve discussed how modern manufacturing crushes people’s souls, let’s not neglect the fact that there are also interesting math problems that come up, [chuckle] which if you like to talk about here on Mindscape, and you just very briefly in the book, mention one fact that I thought was fascinating and worth a whole nother book. The difference at the sort of level of FedEx or whatever, between the hub and spoke model, where there was a few centers that everyone drove to and everyone drove from versus more of a mesh. Like as a network theory person, this is fascinating. We’re somehow learning on the fly how to optimize this network in different ways, and I’m wondering how much of that is just trial and error, and how much of that is actually mathematicians or engineers, computer scientists thinking about this.
1:08:32.0 CM: Well, if you start to dig into the supply chain literature, the amount of mathematics and engineering and computer science in there is really mind-boggling because it’s these big meaty problems where if you can make a fraction of a percentage point difference in the efficiency of a port or a delivery network or whatever it is, you can save somebody like tens of millions of dollars. So the companies in that industry invest unreal amounts in the engineering and the mathematics. I mean, UPS spent $300 million. This was like 20 years ago. $300 million just to stand up their Orion software, which dictates like the routes of UPS drivers every day to make their delivery network as efficient as possible. Who knows how much they’ve spent since then updating it? Probably a comparable amount. And that’s just UPS. UPS is not known to people as a technology company or anything. If you just imagine how much R&D Amazon spends to optimize its own warehouses and its own network. Yeah, there’s so much mathematics. And it’s all of these P versus MP, you could not solve this problem…
1:09:46.8 SC: The traveling salesman problem.
1:09:49.3 CM: If you had the biggest computer until the… Yeah, you’re not gonna solve this problem before the heat death of the universe, so how do we approximate a good enough answer? So it’s definitely an industry where that kind of math just makes such a big difference that that there’s so much thinking about it and so many new models and the application of new tools. I often think that AI is really oversold, but the most boring applications of machine learning are often the best. And predictive analytics, it’s like it was just born to try to predict demand and predict seasonal fluctuations in demand, and heat map where things need to go in the most optimal way, like this is a great application for it.
1:10:42.6 SC: So you just mentioned the AI, the automation part of things. Let’s sort of wind things up with a view of the future. And I think there’s two big questions here. One is, What is the role of increased automation? It’s not going away, we’re not decreasing the amount of automation, right? And then, Is there some sense in which any of these innovations can actually help workers, can give them a bit more agency or is it all just a downhill spiral from here on in?
1:11:14.0 CM: Yeah, I think what we’re seeing in the nature of work in general is this kind of polarization where like, yes, the American middle class is getting hollowed out, and yes, a lot of people have been pushed down the scale of income into jobs that are more managed by algorithm. But also many, many people have been pushed up that income scale and are doing jobs that no machine can do. Sometimes people talk about, “How do you wanna future-proof yourself?” Like, Well, figure out how to solve problems and be creative and get an education, because these are the things that the automation can’t do for us.
1:11:51.2 CM: So I think the real challenge of our time is how do we make sure that as we incorporate more and more automation into our economy, which does make it more productive, which can make life better for everybody, in theory, it certainly produces more wealth. This is obviously the sort of big political issue of our time, but I think at a fundamental level, it comes down to, for a lot of people, like just the dignity of work and how much opportunity they have to make a living wage and have a permanent or a stable job or not.
1:12:27.7 CM: And so I do think that as we incorporate more and more automation, there is an opportunity to do it in a humane way, and there are examples of this in other countries, in the US, at other points in history, where automation has increased productivity, but people have enough agency and enough security in their jobs, that it is in that benefit for them. But obviously we kind of haven’t been heading in that direction for most of the last, let’s say, since the ’70s.
1:12:57.5 CM: I do take solace in the fact that we are experiencing now the so called “Great Resignation” and people seem to be re-evaluating their lives and have some savings and what else, so that they can make these job changes. I do think it’s kind of forcing a reckoning, and I am hopeful that it will then force a lot of companies and a lot of engineers to look at the on the ground impact of the automation they’ve created and make it more humane. And my final thought on that is, I actually know somebody who turns out is the type of process engineer who does this kind of stuff on a consulting basis. And she told me, “I’ve worked on these warehouse systems before. I’m so glad that I read this part of your book because I’d never thought about it from the perspective of the worker.” This person is not a psychopath…
1:13:52.3 SC: No, for sure.
1:13:55.2 CM: Or an unkind person, it’s just they’re thinking about it in terms of, “My job is to optimize this system.” But we have to take this more holistic view.
1:14:04.5 SC: And maybe to just get on the table, the most obvious thing that you didn’t even bother to say, but there’s this very old idea, which is always thus far been wrong, that if you decrease the number of hours it takes to perform a task, people will do less work because they don’t need to do as much work to get the same stuff done, and people 100 years ago, we’re imagining it, by now, we would have three-hour work days and three-day work weeks. But the work always expands to fill the space in some sense, right?
1:14:33.4 CM: Because our demands always expand. Yeah, if we all were content with leading the life that our ancestors had in the 1950s, given the increase in productivity since then like, “Yeah, we could all work like three days a week.” But we wouldn’t have kidney dialysis machines or MRNA vaccines or the Internet or anything else. So we just keep making our material culture more complicated, and the energy and complexity embodied in our consumer gadgets, for example, represents all the extra labor that has to be performed in order to maintain our modern standard of living. And there seems to be no end to that. So yeah, machines don’t take away jobs, but they can change the nature of those jobs for good or for ill. And I think understanding that process and being aware of it gives us the opportunity to kind of bend the arc of history toward making work more humane and more dignified.
1:15:38.1 SC: Well, you mentioned creative jobs, and you didn’t say this, but let’s just air the idea. I do think that there’s, in some circles, a kind of utopian idea that maybe someday we’ll all be writers and poets, [chuckle] once all the menial tasks have been taken up by robots and computers. And I think that that’s a very, almost elitist kind of attitude. I think that there are people who just don’t want to be writers and poets or they, on the one hand, like to work. On the other hand, they’re happy to do something that is sort of solid predictable work because it’s not their lives. They get the meaning out of their lives somewhere else. They just wanna go to work, do a good job and be safe. They don’t wanna work in terrible conditions, but they’re not rebelling against the fact that they don’t produce great works of art. And you had again, one little sentence in the book, it’s a very rich book in terms of individual threads you could pull out. Where Amazon had a program where it would let its workers train to be higher skilled laborer. And number one, the workers are like, “I don’t have time for this. You’re working me too hard.” But number two, the kinds of jobs they thought of training for were basically to be a truck driver. It wasn’t to be a coder or a manager, right?
1:17:03.2 CM: Yeah, the most popular certificate was the truck drivers license.
[overlapping conversation]
1:17:07.1 SC: Truck driver license. I don’t know, you mentioned the “Great Resignation.” Maybe we are on the cusp of a transition where some people won’t have to work at all. I did a podcast episode with John Danaher, who really just sort of intentionally pushed the most utopian automation is gonna free us from drudgery kind of point of view. But you need, on the same hand, to have some basic income or something like that, and maybe the stimulus checks were the first step in that direction. So anyway, I’ve just blabbed a bunch of things. Do you have some big picture visualization of how the future of all this is gonna shake out? Let’s say 50 years from now.
1:17:47.2 CM: I can’t predict how it’s gonna shake out because there’s so many contingencies that I can’t anticipate the impact of like extreme weather and exhilarating climate change and stuff. But I do think that we kind of have the opportunity to… Yeah, work shouldn’t be exploitative, it shouldn’t be unsustainable, physically. These are basic… It occurs to me in this moment that maybe we should consider them rights, like a humane work environment should be a right. We certainly have the resources, the productivity in our economy to accomplish that, and we used to have stronger labor protections, which sort of treated this as a right.
1:18:33.8 CM: I think if we move in that direction, yeah, like Look, this whole idea that we’re gonna get fully-automated luxury communism or whatever you wanna call it. And everybody is just gonna be a poet, I got news for you, like half the people are just gonna sit around smoking weed all day and be very unhappy. Like doing stuff, the dignity of work is extremely important. People need to feel empowered by like, “I did this thing,” and then here’s the result. That is instinctual for most of us, I think. So yeah, this idea that we’re just gonna end work seems silly to me. And it also just completely misreads what automation does to economies, and I think that no matter where people are on the political spectrum, everybody gets this wrong.
1:19:18.3 CM: It’s so aggravating to me, it’s like I wanna write a whole book about just this and other myths about technology and its effects on society and just shake people and be like, “Look, listen, what technology does is it changes the nature of work, and we need to be aware of the way it changes the nature of work, so that we can continue to maintain humane, dignified work.” And yeah, not everybody has to derive their life’s meaning from work, and frankly, more of us should stop trying to derive our life’s meaning from our work. I think that’s on the other thing that the “Great Resignation” is about is people pulling back and being like, “Yeah, I’m in a creative profession, but it doesn’t define me. I’m not my job.” Like, “Oh, maybe I should go connect with my community. Maybe I should spend more time with my family. Maybe I should have a hobby for the first time in my life.”
1:20:04.1 SC: So, I wanna complicate that. I like everything you just said, but I wanna complicate it just a little bit, in two ways. One way is, I absolutely believe there are plenty of people out there who derive dignity from work, even if it’s not creative and fulfilling in and of itself. The very act of doing work and contributing something and occupying that part of your day is useful, and we need to have an economy that lets people do that in a meaningful and well-compensated way. On the other hand, there will be some people who wanna sit around and smoke weed, or sit around and play video games and actually are happy because of that, right? And maybe that should be okay. Maybe we can change society. Like I say, usually once we’re past the one hour mark in the podcast, we can just say any crazy thing we want. Can we change? Instead of saying that automation and productivity gets rid of jobs and work, maybe it gets to the point where it allows us to imagine changing society so much that work becomes less of the lynchpin of our lives.
1:21:11.3 CM: I do like that idea, and I do think we need to do that because I think that if you… My undergraduate degree is actually in anthropology and one of my professor’s favorite things to tell us about was that hunter-gatherer societies are the original affluent society. The number of hours it takes a Kung San tribes person to gather enough calories for the day and do their chores or whatever is like four, and the rest of the time they’re gonna sit around chewing the fat with their neighbors. Go read the book “Bowling Alone.” We’ve had this real kind of tragedy, this death of civil society. At the end of the day, I think because people are just too busy. So yeah, if we can take some of this wealth and this productivity we’ve created and figure out how to distribute that, whether it’s through higher wages or other government subsidies or whatever your political orientation leads you to want to favor, then yes, I think we should aspire to return to a world where everyone doesn’t have to work as hard because we will have a healthier world, we’ll have a healthier planet, we’ll hopefully reverse the trend of more and more people reporting that they’re anxious and depressed every year.
1:22:36.1 CM: I do think, the industrialization of our economy and Taylor-ism and the spread of all of this has created a cultish ideology that everybody should just work, work, work more and the highest value is X, Y, Z measure of success. And I don’t think most people actually really don’t want that. So whatever we can build to get us there, whether it’s universal basic income or however people wanna attempt to get there, or my favorite thing is we really should change our labor laws to make it easier for workers to unionize again, ’cause I’ll tell you what, that’s how we got the 40-hour work week, that’s a really fast way to get wages to go up so that people don’t have to work as hard. Whatever your preferred solution, yeah, we should do that. Everybody should be working less.
1:23:26.4 SC: I like it. That’s a perfect place to end up. So Christopher Mims, thanks so much for being on the Mindscape Podcast.
1:23:31.3 CM: Sean, this is genuinely a pleasure. You have had the best questions of anybody so far.
1:23:35.5 SC: Alright, don’t do anymore. This is it. Let’s go out on the top. [chuckle]
[music][/accordion-item][/accordion]
Really Interesting !
Sean’s intuition of what is relevant to readers is on the mark! Great podcast, the subject and reach of the conversation worthwhile, and deep dives and fact checking-fleshing out some of this sprawling subject will be forthcoming, from Mims and a whole slew of top tier college departments will develop this. Cesar Hidalgo’s “Why information grows” is on the same scale. Once again, the goldilocks level of discussion of this broad broad complex topic. These days, the hot in the machine is us! Thanks for this.
Sean’s intuition of what is relevant to readers is on the mark! Great podcast, the subject and reach of the conversation worthwhile, and deep dives and fact checking-fleshing out some of this sprawling subject will be forthcoming, from Mims and a whole slew of top tier college departments will develop this. Im thinking of MIT’s Cesar Hidalgo, who wrote “Why information grows” in the same ball park. Once again, the goldilocks level of discussion of this broad broad complex topic. These days, the ghost in the machine is us! Thanks for this.
The descriptions of the poor working conditions and mistreatment of workers in the manufacturing, trucking, and distribution centers of the world brings to mind the novel ‘The Jungle’ a 1906 book by American journalist and novelist Upton Sinclair (1878-1968), portraying the inhumane treatment and unsanitary practices in the American meat packing industry during the early 20th century, which greatly contributed to a public outcry leading to reforms benefiting the workers and passage of the Meat Inspection Act. Hopefully the efforts of modern day journalist and writers like Christopher Mims to bring the same kind of attention to present day working conditions will lead to similar reforms.
Um episódio muito elucidativo, quanto ao tema (muito amplo), que gostei de saber.
Tinha algumas noções sobre o mesmo, mas, não imaginava o quanto, todo esse “processo” obedecia a uma série de sub-processos até à sua fase final, que foram bem descritos e discutidos.
Concordo perfeitamente ” o Homem tem de trabalhar menos”. Imprescindível sua segurança no trabalho, número de horas de trabalho, remuneração digna.
Estamos no seculo XXI.
O Homem necessita VIVER. Não, “arrastar-se”.
Obrigada
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Superb show as always.
At the very end, timidly, the participants faced the elephant (gop) in the room head on. All aspects of the show were interesting, but one was by far the most important: the inherent and unnecessary and extreme worker exploitation.
During the century before the 1970s, each generation lived significantly better and worked significantly less that their parents. It’s not a myth or a bad thing. We all did wonder what society would be like when by say 2000 or 2020, we would be living very well and working much less than 40 hours. That was entirely possible but we did not go there because the 1% won out politically and helped themselves to the subsequent 150% productivity growth since the 70s.
An easy way to remember it is that nothing changed re. real per capita gdp and its MEAN. And
until the 1970s, the MEDIAN followed along.
Since that time the MEAN has grown apace, while the MEDIAN has been dead flat, as the unions lost power and the government was increasingly captured by the 1%. The rich already owned most of the stuff, then they helped themselves to the 150% growth in productive capacity over the past 50 years.
To add insult to the injury, companies simply took away meaningful pensions, which was done so deftly under cover of the sham of the 401K, no one seemed to notice. From 1980 to 2000, the 60% of companies paying real defined-benefit livable pensions declined from 60% to 4%.
What futurists like Walter Cronkite in The 21st Century missed is that the rich have an infinite demand for wage-slave labor. So we can still all work 3 jobs to make their rent charges.
You’ve read Einstein’s physics theories. In economics too he was not bound by conventional wisdom. There is a beautiful wise compassionate essay easily found online called “Why Socialism?” You are not an educated person if you haven’t read it.