Business: America the Inefficient

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been swindled in the tradeoff.

Have they really? Is the U.S. actually becoming more inefficient? Or is merely the awareness of inefficiency on the rise?

The answer is elusive because efficiency is one of those relative values that are difficult to pin down. Webster's calls it "effective operation as measured by a comparison of production with cost in energy, time and money." Anyone who attempts to apply that definition can turn up some odd results. Harvard Researcher Ann Carter has been measuring the efficiency of various U.S. industries by gauging the amounts of capital and labor needed to produce a dollar's worth of glass, insurance, hotel service and so on. By these purely statistical standards, efficiency is rising fastest in the telephone and telegraph industries, among others. Even auto repair is rated moderately efficient.

Living with the Repairman

It can be argued that U.S. inefficiency is more apparent than real. Americans expect too much—they have been spoiled by riches, demanding smoother operation and greater variety than any economic system could provide. Many housewives, for example, are convinced that modern appliances break down more often than did old-fashioned machines. Betty Furness, who was once the voice of Westinghouse on TV, offers advice to the woman who wants to keep her appliances humming: "Have a repairman, living with you." But General Electric contends that fewer than 3% of its toasters, electric coffeemakers and other housewares are repaired under warranty today, compared with more than 6% ten years ago. Trouble is, today's appliances are so complex that they are tough to fix when they break down and, as a G.E. officer says, "the consumer is more conscious of malfunction today than ever before."

Visitors from abroad support the U.S. consumer's impression that something is happening to American efficiency. Compared with most foreign countries, the U.S. as a whole is still staggeringly efficient, but the image of oldfashioned, charmingly inefficient Europe in contrast with America is no longer true.

Robert Ball, TIME'S European economic correspondent, is impressed by the changes that he notices on periodic visits home. "The breakdown in street cleaning and trash removal seems symptomatic of a general decline in urban public services," he reports. "Certainly public transport in a city like New York is a disaster. The subway system is one of the dirtiest I have ever seen —worse than London—and is by all odds the hardest to use. A visitor now is usually spared the rigors of long rail journeys because there are hardly any trains. Even airline efficiency in the U.S. is no longer so great. I have seldom experienced anything in Europe that approaches those hour-long holds over Kennedy Airport.

"If the visitor stays long enough to do some shopping, he will see evidence of inefficiency in the shoddiness of many types of goods. Blue jeans seem to be the only children's clothes that last any more. Corduroy clothes, which used to be bought for durability, just melt away. Sales clerks often seem to be uninformed or indifferent, though they are not yet as bad as waiters."

The countless petty and major annoyances are cutting into the quality of American life, and indeed into the quantity of the nation's