Feature Archives | Feedback

The Economy

Congratulations, this country just celebrated the longest peacetime economic growth on record. For seven years the economy has continued to grow without a recession in sight. It's amazing to hear the various economists, attempting to explain how we can have continued growth, without inflation. They proffer all sorts of answers such as low oil prices; globalization, cheap labor in developing countries, and some even mention the computer. All these talking heads confirmed my belief that: "If you put all the economists in the world, end to end, you still couldn't reach a conclusion."

The truth is, we have had low oil prices before, we have had an abundance of cheap labor also, but what we only recently have gotten, is computers and networking. That is what has reduced costs, and increased efficiency of companies. It is not hard to see computers in action. At the supermarket the speed of checkout lines using bar code scanners exhibits the obvious speed increase computers provide. It also reduces the number of checkout people required because their efficiency has increased. McDonalds and Burger King don't even ask people to know the prices. Just hit the "Big Mac" key on the computer and it adds it to the bill. Change? Enter the money given to you and the computer tallies the change.

Companies can better control their inventories by computer. Just in time delivery, could not work without the speed of communication offered by computers on networks. Every piece of our industry has changed. Gas stations allow you to charge your bill at the pump, UPS and Fed-ex track your shipments through scanners, and the Internet. My dry cleaner and auto-mechanic, keep all their records and print out their bills using a computer. No matter what you buy or do, computers share in the experience.

Efficiency

The end result of all this computerization of our country, is increased efficiency. I remember in the 80's when companies that could ship $100,000 per employee where considered efficient. Today companies like Dell, ship $750,000 per employee! That is real efficiency. As the efficiency increases, a company can afford to pay its employees more without raising prices. This results in growth without inflation, the best of all possible worlds. Eventually the efficiency increases will slow down and possibly inflation will appear, but this amazing economic run, is mainly due to the added efficiencies, brought about by the computer and the Internet.

Are Economists "Computerphobic?"

I do not know any economists per se, but I do know that there are a lot of persons that can be described as "Computer-phobic." Some that I personally know are:

Bob

Bob is President of a small engineering company in Silicon Valley. Bob tells me that computers do not increase the efficiency of his company. He tells me that he still has the same number of people in accounting, purchasing, sales and marketing as before, but now he has to also buy them computers.

Bob doesn't have a computer in his office. He accesses his stock quotes through an 800 number. When you tour the company you realize that computers are everywhere, engineering uses them for analysis, manufacturing has installed a computerized test set, purchasing is completely by computer. Bob doesn't see it.

Ed

Ed is a stockbroker for a top brokerage house. He has a computer on his desk but only uses it to look up customer's records and quotes. Ed hates his computer. He does not like email and refuses to give out his address to his clients. He never goes to the Internet because his connection is very slow and he can't seem to have the IT people fix it.

Richard

Richard is a lawyer. His office has about three computers for his secretaries, all running DOS! Richard doesn't have a computer on his desk. He has told stories of times when in court, other lawyers have shown up with laptops and a program called "West Law", which allows them to look up cases in a flash. Richard still likes the "Library" in his office. He subscribes to a service that charges a small fortune to deliver the latest case in book form.

Eric

Eric is a minister. The church computer has all the bibles in software on its computer, unfortunately Eric never learnt to access them. His secretary uses the computer for all church functions. When she was sick for a week, Eric could not step in and print the Sunday bulletin. Eric said he would learn to use the computer. That was three years ago. We are still waiting.

Computer-phobia

It would appear that I have somehow ferreted out these examples. The truth is that they represent my business associate, stockbroker, lawyer and minister. All have various degrees of computer-phobia. I have to surmise that there is also an abundance of economists with the same myopic vision, looking to blame anything but computers for the present economic boom.

I recently received a telephone call from a neighbor. His daughter had given him a computer for Christmas. He asked me how he could send email to her. I said, "To start, double click on you Internet Icon." He answered, "This isn't going to work." and hung up.

Many people still are afraid of computers. Whether it is typing skills or just the learning of such a complex device scares them. Possibly when voice to text allows people to just talk to the computer it will make a difference. Economists might then understand that "It's the computer, stupid."

Frank Greenhalgh
February 14, 2000

About the Author

Frank Greenhalgh has been working in power supplies and systems for 38 years. He has many impressive accomplishments and patents. Over the years he has made significant contributions to Trio Laboratories where he held the position of Chief Design Engineer and was then promoted to Vice President.