Submitted by Marvin Miller

Religions and governments are involved in ethics: they tell people, by commandments, laws, etc., what they want people to regard as the right thing to do.

Our society is the most inefficient in the world.

In physics, efficiency is defined as the ratio of useful work done to total energy used. Americans use more energy per capita than the people of any other country. But we don’t live better than people do in other technologically advanced countries. Those of us who have jobs work longer than people do elsewhere. We don’t spend less time getting to and from work than others do. We don’t have more time for lunch breaks, vacations, leave for family care, or holidays than others do.

Another more general way of defining efficiency is results obtained compared with resources used. Economists may use the monetary value of goods and services produced and delivered as the measure of results and the money spent to accomplish this production and delivery as the measure of cost. By this measure, the relative efficiency of U.S. production and distribution is not obvious. We know that most of our products come from far away, across the country or around the world. The resources used in this long distance transportation are a cost of production and reduce efficiency.

From the viewpoint of human welfare, this economic measure can be misleading. Production of harmful products, such as bullets or cigarettes, counts as production and so does the work done in trying to remedy their effects, like medical care, or in dealing with their ultimate results, like funerals. Costs to future generations such as degraded environment aren’t counted. Indeed, we can’t possibly know their full extent.

Only paid work is counted as a cost in economics. Unpaid work by parents taking care of their children or by family members taking care of other family members who need care doesn’t count, because no money changes hands. The value of work is measured by the amount of money paid for it. The work of highly paid workers, for example, a corporate lawyer devising a merger, counts a lot more than that of a low-paid worker, like a strawberry picker or a hospital laundry worker. But it’s not clear that the former makes a greater contribution to people’s welfare than the latter.

Businesses may use a different measure of results — profits rather than production. By this measure, highly profitable businesses, such as, for example, financial speculation, may be regarded as efficient, even though they only change the ownership of assets rather than improving people’s lives.

The American healthcare “system” is notoriously the most inefficient in the world. We spend much more per capita on healthcare than any other country, but we aren’t healthier and don’t live longer than people in other advanced countries. Much of what we spend on health care doesn’t go for health care. Instead, it goes for the determination of who pays whom how much for what. Countries with universal systems deliver health care much more efficiently.
Improving energy efficiency in heating, power generation, and transportation might make fossil fuel companies less profitable, and their political power has impeded progress toward it.
Our gigantic military establishment is at best a colossal waste, and, when not at its best, destructive.

In our society, efficiency is often praised, but not always sought in practice. From an ethical viewpoint, efficiency ought to be measured by human welfare produced versus human harm caused. If we did that, we would have a measure of efficiency different from the ones commonly used.