So what do we call all this inefficiency? Well, we used to call it the middle class. And that was the beauty of the thing: Potent enough as an engine to add real value, and create tremendous real wealth, but inefficient enough at concentrating that wealth to support a prosperous middle. 40 hour work weeks are inefficient. Weekends are inefficient. Overtime pay and safety rules are inefficient. Livable wages, health-care, one-worker families, and pensions are all inefficient. At least they are at concentrating wealth in the hands of a only a few. Oh, a little chaos still allows to the rich to get richer, and I for one wouldn't have it any other way. Those Scribes of Leviticus were no Marxists, mate.
Efficiency = (work out/work in) x 100. For financial tools simply replace "work in" with "capital + resources in", and "work out" with "profits extracted".
But...uhhh...isn't that what we are all taught to achieve as our goal...increased efficiency in all things?
Yes, we always try and reduce imprecision and variation in both the design and manufacture of a part or assembly. But that is for an inanimate closed loop system, a machine, in other words...a thing. Say an oil pump for this example. We want the best oil pump with the least variation between components as is economically feasible to design and manufacture. In short, we want a damned good pump and for a damn good price, if nobody minds. But what is the pump actually being used for?
Since humans have fuck-all use for having lubricating oil pumped directly into and through their own bodies, the oil pump is neither the rationale nor the end result. The pump supports an activity, but is not the activity itself. Nobody runs oil pumps just to see the oil flow around and around in a loop. So the question should be: What is the end result the pump is supporting?
Now, if our pump lubricates an engine whose output (work) we all benefit from, we would want it to run as well as possible, doing the most work for the least energy, and hopefully without too big an impact on the environment (zero impact is neither achievable nor necessary). The short version? We want an efficient pump ("Good pump, well done!").
On the other hand, if I installed that same oil pump to lubricate a machine that scooped up kitties and puppies and ground them into sausage meat and industrial lubricants, one might hope that it is not as efficient at it's task as it was when it was lubricating our benevolent engine ("you nasty, awful little pump, fuck off!"). But it is the same damn pump, mate, its' own efficiency is not based on what the machine it is pumping oil through is accomplishing.
But before we abandon all hope for the puppies and kitties, we do have a moral choice to control the use of machines that our now thoroughly confused and bipolar little oil pump is supporting. The tools themselves are amoral. The same pump can be installed in a factory to make Baby Aspirin...or Zyklon-B. Same tools, but the end product is our choice, not the pump's.
Now where it has gotten really ugly for the middle-class is that high-end Financial Tools and Trade Policies (or lack of them, really) have become a virtual machine, and one with a single purpose: To transfer wealth to the top 1% of the Country from whatever source it can (it basically creates fuck-all for wealth compared to the resources in Capital and Brainpower it consumes, as actual wealth creation would not be as efficient in concentrating wealth (for a select few) as the model they have now).
OK, that wealth concentration machine uses zip for oil pumps, but it does use tools, as in derivatives, options, swaps, algorithm based ultra high volume trading, 24/7 globally linked financial and currency markets, etc.
And it can be argued that the virtual wealth concentration machine works very efficiently indeed....or all those clever lads and lasses running it might be doing something else with their lives. But while it is efficient for its' own purpose, is that purpose in the best interest of the middle-class? Since little of actual benefit is being delivered to 90% of the populace (actually more like 99.8% are SOL eventually if the middle-class gets much worse), what was the function of the enormous profits and accompanying bonuses that the Financial Institutions are now reporting other than their own existence? What did their machine produce for the rest of us besides kitten-sausage?
Worse, while grinding puppies and kittens and the middle-class into profits, the same virtual machine has stopped lubricating our engine, the one we use to drive the economy. In fact, it has diverted lubrication to use for its' own ugly purpose and left us clattering and near seizure.
And so what we are dealing with is a perversion that was enabled by technology, but is not a requirement of that technology. Hell, I like advanced software and fast computers, I couldn't do my job without them. So it is not the technology that is an issue. The Luddite model is still fatally flawed. I hate for you to hear this from me, but we are not going to stop people from using algorithms. We are simply going to need to make it inefficient to use those tools to fleece the middle class. The algorithm itself is not a moral choice any more than the oil pump was. They will still exist after reform, but will be used for a better end result than the current one of re-establishing Feudalism.
So maybe the best thing we can do as a society is forget trying to control individual or group behavior in and of itself simply by outlawing or restricting their tools. That is a fool's errand and eventually leads to a a failed totalitarian model, or one in which the reformers are so wrapped around their own axle over tools, the end result is unchanged.
What we can do is allow virtuous outcome enterprises to operate with a much higher efficiency than we do non-virtuous outcome enterprises. Same pump, same algorithm, different results. We can and do control the efficiency of the entire enterprise (or would again with the proper reforms), and we do so by altering the possible outcomes, not the design of the tools themselves (which is probably impossible anyways, tools being tools). The pump may be efficient in theory, but in practice we can make its' end use inefficient by eliminating, or drastically curtailing, the output (profits) of the the non-virtuous enterprise it is supporting.
Hell, people didn't stop making rotgut Gin in their bathtubs in 1934 because we took their bloody tools away. All the bathtubs and copper tubing still existed. No, they stopped all by themselves once prohibition ended and took the profits away. Brewing bathtub Gin simply became hellishly inefficient to the bottom line once you could get the real stuff.
Efficiency = (work out/work in) x 100. There is little or no future in trying to control output by grabbing the tools out of people's mitts. In fact, those that are using the tools to gut the middle class would entirely prefer that your focus was on the tools, not the gutting. They know the tools better than you, and will be perfectly happy to lead you down a bunny trail of impotent legislation and endless delays in enacting real reform. There is nothing more the Plutocrats of this society would enjoy than to have Congress start holding hearings on...fuck me...tools. Yep, one Senator after another overflowing with the desire to finally show the American People just how smart he or she is, while the Plutocrats and their hired giant brains laugh so hard that piss is running down their legs. Which I assume one of their minions will quickly and efficiently attend to.
The good news for us? We can, again with the proper reforms instituted, very easily control the profitability (work-out) of an activity without getting bogged down in tool-speak. If the "work out" becomes small enough that the overall Efficiency plummets, people will seek other results ("Hmmm, looking at the tax advantages, I would make more profit if I financed domestic manufacturing instead of concocting ever more complex derivatives"). And they would choose differently without having to be told to do so. OK, there would be a few Power-points involved, and way too many meetings, but they would eventually get around to doing...exactly what would now be in their best interest to do. People are funny that way.
Remember: 40 hour work weeks are inefficient. Weekends are inefficient. Overtime pay and safety rules are inefficient. Livable wages, health-care, one-worker families, and pensions are all inefficient at concentrating wealth in the hands of only a few. And as long as the current funnel-all-the-money-to-a-few-pockets model exists, you can kiss all that and the middle-class good-bye. Unless you make preserving those foundation stones of the middle-class a more efficient generator of wealth than destroying them, it's game over mate, they will continue to be destroyed. And not "a more efficient generator of wealth" on an absolute scale, that is dim-witted and guaranteed to fail. I mean damn, that absolutist bullshit is 80% of how we got in this mess. No, the battle for the middle-class is won or lost on a relative scale, and it always will be. The middle-class can only exist as a relative concept, not an absolute one. The absolutes are just rich...and impoverished.
Because it was always going to be more efficient on an "absolute" scale for the Bankers to put ungrateful urchins in workhouses, and get a decent day's tally out of them in return for that single bowl of gruel, than it was to try and educate the shabby little wastrels. But that stopped when it became more profitable to have them in school than on the shop floor. And when it stopped it had fuck-all to do with the gruel...or the tools being used. We just changed the possible outcomes to the benefit of all.
Cheers.