Atop the Forces of Production
Announcing the launch of the Forces of Production macro data newsletter
Whether you think about it or not, you are already aboard an economic vessel, squinting to see the future atop the forces of production. Your ship could be a business, a government agency, or you might be sailing on nothing more than your wallet — you are already navigating, economically.
Should you build that new factory domestically or abroad, given the new tariffs? Should industrial policy target innovation or stability? Should you really pay that much for a basket of groceries? Answering feels like steering, but these decisions are made atop currents no one fully controls — transactional oceans that move you even as you try to move yourself.
Yet your navigational decisions — which you must make constantly — are responsible for keeping your ship intact and on course into the uncharted waters of an uncertain future. The economy can be more treacherous than thesea: new stars that don’t match old charts seem to appear and disappear; the productive forces shape the waves and tilt the skies.
Old maps of development showed a one-way path to manufacturing and modernization, yet the service sector increasingly drives developed economies. Boosters promise unlimited productivity gains from AI while the electrical system promises ever-growing lead times for the new transformers and turbines which will power the data centers behind those “unlimited gains”. Consumer spending hits new highs while consumer sentiment shows epochal pessimism, and the world adapts to Trump’s tariffs, whose effects remain far from clear.
All of us now are traveling into the open ocean of an economy whose activities are actively changing the climate that has so far made them possible.
In conditions like these, sailors have long distinguished two ways to navigate. Any sailor who can, navigates by Position Fixing. When you can see the stars, pick up the beacon of a lighthouse or satellite, or find a shoreline landmark, you can triangulate your precise position with little more than simple geometry. If the angles of the landmarks can be found, then you can fix your position as the third point of a triangle. By keeping track of these position fixes, it becomes possible to plot a trajectory, to map forces in the winds and in the seas, and to begin to find your way.
Most importantly, you know where your ship really is, in a way you can tell someone else about — maybe someone who can alert you to an oncoming squall or an invisible reef. If, say, we can see employment slowdowns and falling capacity utilization in machinery production, but demand is rising for machinery while employment in metals mining and refinement grows, we might be able to pinpoint an economic bottleneck. If we see rising importsand rising import costs, for both machinery and the metals complex, we might be looking at a global pinch-point for capital goods used to produce machinery.
But if position fixing is impossible, you fall into a position that sailors have long dreaded: Dead Reckoning. Without stars or landmarks, the best you can do is feed old position fixes into the system. Dead Reckoning is nothing more than a guess at where you are, based on where you thought you were, and where it seemed you were heading then. Errors accumulate, and ships drift off to wreck without ever seeing where they really were. Auto manufacturers learned this over the pandemic — expecting a cataclysmic fall in demand, they cut orders for the parts they use in production, especially semiconductors. By the time they had updated to the government’s fiscal strategy, they were at the back of the line for those semiconductors. The result for the broader economy? An inflationary shortage from millions of missing vehicles.
Dead Reckoning can help, but if Dead Reckoning is your only strategy, your ship will need more help than your strategy can provide.
Worse still, the navigational problem we collectively face is bigger than any one ship. Your ship can only be one of hundreds of millions in the convoy of the US economy. However well-navigated, its trajectory will always be contained and shaped by the direction and drift of the convoy as a whole: everyone is heading somewhere. Wassily Leontief anticipated the automakers’ pandemic-era problems decades in advance:
The real problem is that, despite all its gigantic, intricate complexity, the economic convoy has no leader. The government issues documents each month — employment reports, production figures, price indices, trade data — which share their measurements of the convoy’s boundaries and internal dynamics. Yet no one is responsible for fixing the convoy’s position, let alone tracking its trajectory. Without tracking, decisionmakers use simplistic heuristics — are inflation and unemployment too high, is growth too low, are exchange rates stable? — to make decisions about a tangled economy whose internal structure is never examined. Steering the convoy as a whole requires understanding how different sectors relate to one another domestically, and how each relates to the broader world of global trade.
The best record of the broader economy kept by most ships is Dead Reckoning — guesses about how things are built on earlier guesses about how things were. Have they and the people they know been doing better or worse? What do they hear on TV? How are their suppliers and customers doing? Have the prices they care about gone up? Individual ships react to the ships around them, and those reactions propagate across the convoy: price shocks during the pandemic cascaded from sector to sector as businesses and households adjusted to changes nearby. Now reports filter in suggesting danger ahead — climate crisis, inequality, loss of capacity — and that the convoy will need to change direction.
Most ships navigate by feeling, but even the best-navigated individual ships cannot steer a convoy that doesn’t know where it is.
The work of steering towards an affordable and democratic future can only begin with a shared understanding of where we actually are.
To avoid blunders and plan for a real future, someone must fix position for the convoy as a whole and begin keeping a record. That record can then be used to design the new maps necessary for directing renewed public investment — not by commanding every individual ship, but by charting a course the convoy can actually follow.
With this problem in view, Common Wealth US would like to announce the launch of Forces of Production: a monthly log of position fixes for the convoy, covering the supply side of the US economy.
Each month we will explain what happened the month before based on the newest government data and some reactions from the press. We plan to survey the Producer Price Index, Employment Situation reports, Consumer Price Index, trade statistics, Industrial Production and Capacity Utilization figures, manufacturers’ surveys, and other hard and soft economic indicators to develop a holistic account of what has changed and where.
Every monthly entry will build on the one that came before. Our goal at Common Wealth is not only to keep a record of the economy, but to be able to show where our policy proposals fit into the economy that actually exists, and how better planning and coordination can be achieved. All attempts to change the economy — from industrial policy to macroeconomic management of the business cycle — must be based on an image of the actual forces, the actual capabilities and powers of the economy itself.
Forces of Production offers a record of where the economy has actually been, publishing on the second Monday of each month on data released in the previous month.
At Common Wealth US, we work to complete the climate transition while building toward a decommodified future and democratized. These are immense, existential goals: decarbonization will require us to restructure production at civilizational scale, decommodifying life’s essentials — housing, healthcare, childcare — will mean a fundamental reorganization of the service economy.
These transformations require coordination: the convoy as a whole must change direction in ways no market can organize and no individual actor can command. Though we cannot make a map of the future, we must make maps for the future.
Forces of Production is for those captains who would like the convoy to move beyond dead reckoning, to fix position and find its way in the growing dark. If we do not know where we are, coordination is impossible. But by fixing a trajectory and building a map, we can begin to understand the forces that move beneath us, to find which paths lead to safety and which to wreckage. At Forces of Production we work to start building the common reference point.