The holiday season is almost upon us, and what’s better than a Christmas movie? And a Christmas song? And what about Christmas movies with great Christmas songs like “Silver and Gold” by Burl Ives in “The Red-Nosed Reindeer”? And of course, there’s Yukon Cornelius, a for-profit entrepreneur and prospector obsessed with finding silver and gold. If silver and gold are so great, why don’t we use them in everything?
Silver conducts heat and electricity more efficiently than other metals. Why not wire your house with it? Make an electric stove from it? Or why not try doing these things with gold? Gold is less conductive than silver or copper, but it has many other valuable properties. For example, it is highly ductile, can be drawn into the thinnest of wires, and will not corrode or discolor. It’s also beautiful, which is why Burl Ives sings, “Silver and gold/It means more when you look at it/Silver and gold ornaments/On every Christmas tree.”
The conductivity example illustrates the importance of price and monetary calculations. IT also explains why most silver and gold decorations on Christmas trees are fake. The “best” metal to use for a particular task depends on the situation. If you do a little research on Google and ChatGPT, you’ll see that there are some drawbacks to using Gold, for example, for connections that need to be plugged and unplugged frequently. Gold is conductive, ductile, and does not tarnish. However, it is much softer than metals such as chromium, nickel, and tin. If you’re making a USB-C cable or a plug for a vacuum cleaner, this may not be what you want.
I sometimes hear people argue against arguments for raising labor costs through things like minimum wages and other regulations because companies “want to use the best technology possible.” But “best” is determined by price. Look at the computers people are using in your workspace. Does every desk have a top-of-the-line supercomputer? No, you don’t need Oak Ridge National Laboratory’s Frontier System to check your email or create a spreadsheet. You also don’t need it to run a self-checkout line at McDonald’s or Dollar General.
It all comes down to a version of the big economic problem. Markets are continuous conversations between thinking and feeling agents, not computational problems. When Ludwig von Mises and F.A. Hayek explained the problem of economic calculation under socialism, they were making an epistemological argument. Rational economic calculations, although perhaps unfortunately defined and described, are not problems that can be solved by sufficiently powerful computers, even in frontier systems.
Resources have alternative uses, and competing bids and offers in a free market allow widely distributed knowledge to be leveraged in allocating resources to those uses. The best metal to use for electrical connections is determined by people’s ideas about how to make jewelry and cookware. For example, if advances in asteroid mining and extraction find enough gold, we might be able to look forward to a future in which robots cook our meals in pots and pans made of gold and silver (just before decorating trees with silver and gold decorations).
