Past peak efficiency
On the TPP, a cyberattack against Jaguar Land Rover, and the most economically efficient day in history (that passed without us knowing)
After about six weeks of a complete shutdown, Jaguar Land Rover is restarting production at three manufacturing plants in the UK. They were shut down by a cyberattack in August and have been frozen ever since, not only putting the company’s direct employees on ice, but also freezing the enormous supply chains that feed modern automotive manufacturing. What’s really bad for Jaguar Land Rover might be catastrophic for some of its captive suppliers.
■ It seems likely that we passed a milestone sometime between ten and twenty years ago without knowing it: The peak of modern production efficiency. Someone will undoubtedly try to fix that date with some precision in a real academic paper, but it’s somewhere in that range: Late enough that the gains from Internet-enhanced commerce were largely realized, but cyber threats had not undermined those benefits. Similarly, as far advanced in the gains from trade and specialization as we could reach, but before the reckless dismantling of the pro-trade order (the failure to get the US into the Trans-Pacific Partnership seems to be a real bookend to that era).
■ Whether it happened before or after the 2007-2009 financial panic is difficult to say. The pre-crisis era had greater overall confidence; the post-crisis era had the energy of people trying to make up for lost ground. Regardless, it should be clear to us now that conditions will henceforth be harder than they were then: Antipathy to trade is going to hurt us (semi-permanently, at least), and the overhead costs of dealing with criminal elements among us in cyberspace will permanently shave off some of the peak gains we could have obtained from technological efficiencies.
■ Regrettably, we’re left to adjust to a more brittle state of affairs. Supply chains can’t be just-in-time anymore, whether because of abrupt changes to tariffs or because of ransomware. Perhaps even worse, the insidious incursion of AI-generated junk content is contaminating the Internet and distorting search results, making the path out even harder to navigate. It turns out that Joni Mitchell may have been a prophet of our times: You really don’t know what you’ve got until it’s gone.
