The series this is from (Free to Choose) is a great introduction to economics for people of any age. I highly recommend it.

This particular example can be misinterpreted though. It's true that no single person knows how to make that exact pencil that he is holding. But it's not true that no single individual exists who can make a pencil by themselves. If the criteria is just that it works as a pencil, then many people could make or find something that fills that criteria.

This is an important distinction because there are things like microprocessors, which no single person knows how to make. But also: no single person could alone build something that has anywhere near the same capability. It's conceivable that a civilization could forget how to do something like that because it requires so many people with non-overlapping knowledge to create anything close. We aren't going to forget how to make pencils because it is such a simple problem, that many individuals are capable of figuring out workable solutions alone.

> This is an important distinction because there are things like microprocessors, which no single person knows how to make.

That depends on your definition of “knows how to make.” I worked at Samsung Austin Semiconductor for a while, and there are some insanely smart and knowledgeable people there (and, I’m sure, at every other semiconductor company). It was actually a really good life experience for me, because it grounded and humbled me in the way that only working around borderline genius can.

I can describe to you all the steps that go into manufacturing a silicon wafer, with more detail in my particular area (wet cleans) than others, but I certainly can’t answer any and all questions about the process. However, I am nearly certain that there existed at least one person at SAS who could describe every step of every process in such excruciating detail that, given enough time and skilled workers (you said “know,” not “do” - I am under no delusion that a single person could ever hope to build a fab), they could bootstrap a fab.

> This is an important distinction because there are things like microprocessors, which no single person knows how to make. But also: no single person could alone build something that has anywhere near the same capability

I recently watched this: https://www.youtube.com/watch?v=MiUHjLxm3V0

The levels of advanced _whatever_ that we've reached is absurdly bonkers.

It seems to me that at some point in the last 50 or so years the world went from "given a lot of time I can make a _crude_ but reasonably functional version of whatever XYZ in my garage" to "it requires the structural backbone of a whole civilization to achieve XYZ".

Of course it's sort of a delusion. Maybe it's more about the ramp appearing more exponential than ever.