MARCUS: Knowledge economy is not new

The phone rings. I answer, “Hey-lo?”

“Mr. Marcus, Morton? You don’t know me. I’m Linus Cone and I read your column in the Crothersville
Times. It’s enjoyable, but you don’t resolve things. You don’t come to conclusions. I’m always
left hanging.”

“Good,” I say. “My pervasive doubt and intellectual insecurity are getting through.”

“That’s (here he uses a phrase your family newspaper will not print). You have an obligation to be clear and
definitive.”

“Mr. Cone,” I say, “few matters in life are clear and definitive. Sadly, we grow up learning that all can
or should be reduced (or elevated) to mathematical modeling. We have no courses or TV channels specializing in ambiguity,
no college major in uncertainty.”

“Please,” he pleads, “stop it! Let’s just talk simply about something, anything.”

“How about where the world is going?” I suggest.

“If you must,” he says. “Where is the world going?”

“Nowhere different from where it has been,” I reply.

“Impossible and inconceivable. How can you say that?” he asks. “We’re moving rapidly from a manufacturing
to a knowledge-based economy.”

Now it is my turn to offer a phrase your newspaper will not print.

“Mr. Cone,” I say, “that is a line of guff being spewed by those who want you to think they know something
you don’t and that you should feel inadequate about your role in society.”

“B-but,” he sputters, “you hear it all the time from the leading observers of our era.”

“Knowledge,” I say, “is and has been the key element in the production of goods and services since our
ancestors started collecting fruit in the trees and nuts on the ground. If you know eatable from poisonous, you have knowledge
and live. If you know how to kill an antelope or catch a fish, you live. Knowledge of the seasons and the properties of earth
and water are the foundations of agriculture.

“Manufacturing,” I continue, “is the transformation of knowledge into goods that permit others to do what
they otherwise could not. If you know how to make an arrow, a plow or fertilizer, you are making it possible for others with
lesser or different knowledge to be more productive. We have always lived in a knowledge-based society. In that respect, today
and tomorrow are no different from the days of Cleopatra.

“Knowledge builds on knowledge,” I persist in my barrage of verbiage. “Those pushing the ‘knowledge
economy’ are saying that the less educated, with fewer degrees, are not fit for today’s world. This mantra then
is taken up by business and political leaders who want to be seen as with it, hip or au courant.”

“And?” he says.

“Exactly, Mr. Cone,” I declare. “The point of all this is that the point has been missed. The idea of the
knowledge economy is a perversion of the concept of a knowledge industry, where knowledge is considered a product that can
be managed and marketed. Universities and independent laboratories, as well as individual firms, are part of the knowledge
industry.

“In the past, stretching back way before the Cubs’ history of failure, the creation of knowledge was not organized;
it was hit or miss. Now, the idea is, knowledge can be produced through appropriate management, subjected to corporate discipline,
promoted by advertising and packaging. Gone is the individual accidentally discovering something of value; today, knowledge
is believed to be a vein of ore that can be mined.”

“Well!” he says. “That was certainly a definitive declaration.”

“I don’t know,” I say. “I could be entirely off-base again.”•

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Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business
Research Center. His column appears weekly. He can be reached at mmarcus@ibj.com.