Tag Archives: US

What is Holding the US back from Metrification?

Of the 200 or so sovereign nations in the world, only three remain that have not officially adopted the international system of units, more commonly known as the metric system.  Those three?  Myanmar, Liberia, and the United States.  In the past few years, both the Liberian and Burmese governments have taken measures to adopt the metric system, so why has the United States made no effort to ensure that it is not the last nonconformist in the world?

globalmetrification
Map showing adoption of the metric system by country (source: wiki)

It may surprise you to hear that the United States actually has made such an effort: in 1975, President Gerald Ford signed into law the Metric Conversion Act, stating “To say that this legislation is historic is an understatement. The question of a common measurement language is, in fact, nearly as old as our country. President George Washington raised the issue in his first message to Congress on January 8, 1790” (source: UCSB American Presidency Project).  Indeed, our country’s founders gave great thought to establishing an intuitive measurement system, and Thomas Jefferson proposed a base-ten measurement system of his own design, yet the United States still settled on the imperial system, partially because the metric system had not been designed yet at that point.  So if our nation’s leaders have made tangible efforts to shift us towards a more logical system of measurement, why haven’t we?

In our nation’s infancy, it was our close ties to Great Britain that kept us on the imperial system.  As the country matured and industrialized, it became more dependent on the existing system.  Britain switched over to the SI system to conform with the rest of eastern Europe, but the United States has something that Britain doesn’t have: a large domestic consumer base.  With no need to rely on exports, the US economy was able to develop with an independent measurement system.  Today, the barriers to adopting a new system are larger than ever before.  The costs of a transition would be enormous: infrastructure systems like our road signage would have to be completely redeveloped, product labeling and manufacturing goods would have to be swapped out, and our education and training techniques would have to change, to name a few expenses.  But it is undeniable that there would be massive benefits.

The National Institute of Standards and Technology claims that “current effort toward national metrification is based on the conclusion that industrial and commercial productivity, mathematics and science education, and the competitiveness of American products and services in world markets, will be enhanced by completing the change to the metric system of units”, as quoted in Scientific American.  In a global marketplace where the American education system is falling behind to those of other developed nations, the US should be doing all that it can to ensure that it can still produce engineers and scientists that can compete with those being born elsewhere in the world.  But keeping up with other leading STEM countries is just one of the benefits.  The metric system, with its base-ten units, simply makes more sense for industry.  As Thomas Rutherford writes in a Colorado State University publication, the savings from productivity and quality could amount to 1% of construction costs in industries like highway construction, savings that would quickly add up to massive sums over the course of just a few years.  On top of this, our industries would be able to import and export durable machinery goods to the rest of the world.  The rewards would be countless, and would quickly exceed the costs in the same way that an initial investment can provide perpetual returns.  And yet, it is still a topic that incites discomfort amongst Americans.  No generation wants to be the one who has to bear the costs: both literally and the mental burden of changing the way we perceive measurements.  That is why the process must be a gradual one.  It must start from the bottom up.  The US should begin to emphasize the metric system more in early education, even if it means teaching two systems of measurements for a time.  The longer we wait, the more we lose out – the opportunity costs of staying on the imperial system are only rising.

Naysayers about Cheaper Oil are Missing the Big Picture

Thursday, a panel of 69 economists surveyed by the Wall Street Journal discussed the economic impact of the weak oil market, noting their concerns that the low price of oil is causing a drag on capital expenditures by energy companies.  The article claimed that cheap oil is “a double-edged sword for the economy given how it might affect the boom in U.S. oil and natural-gas production”.  While there may be some truth to that statement, one edge of the sword is far duller than the other.  Capital investment has not even begun to exhibit the “sharp pullback” that the the economists are predicting: they only cut their forecast for the increase in plant property and equipment by 1.5%, and that is still only an estimate – such forecasts are often off by even more than 1.5% as it is quite difficult to predict how the economic landscape may change over the course of a year.  As demonstrated by this graph from QZ, even though the US oil rig count is down, production is still rapidly climbing.

US Oil Prod

The slide in oil prices began almost nine months ago now, and it’s clear that production shows no signs of slowing down, especially since prices seem to have bottomed out and are now back on the rise.  While it may look like the energy sector is going to take a hit this year, I doubt that will be the case as prices continue to bounce back and growing US oil producers seek to lock in capital investments before interest rates begin to rise, which will likely occur sometime midway through this year, as indicated by the Fed and reported by the New York Times.  On top of that, the US oil production industry is still growing rapidly, and it seems likely that producers would want to ramp up investment now so as to carve up their slice of the market before it fully matures.

So while the Journal’s economists did still admit that cheap oil was a net positive on the economy, they might be overplaying the threat of a drop in capital investment.  The availability of cheap oil will not only continue to drive up consumption and thus overall business growth, but will spur investment from other sectors that benefit from cheaper energy.  As transportation-focused industries take advantage of the low prices by increasing their own investment, demand for oil will grow, strengthening the case for oil producers to keep increasing production.