A lot of this covers economic growth that I don’t think is really covered in the US. People making $7.25 in 2009 can very well be making $7.25 today as the minimum wage hasn’t gone up. Healthcare, education, and housing aren’t more obtainable now yet they are absolutely crucial for a society.
But when I hear “the economy” being talked about it’s either low unemployment (which is really just a survey of Americans on if they’ve applied for a job) or about stock values (which are predominantly owned by the very wealthy) going up.
What good is an economy if you can’t afford the things you need?
I get the impression that a lot of people in the west fundamentally fail to understand what the purpose of an economy actually is. An economy is a model for allocating labour and resources in a way that meets the needs of the people in the country.
The original argument for capitalism was that market economy with private ownership is the most effective way to allocate labour and resources in a way that benefits everyone. Measures such as jobs creation, the stock market, and GDP were meant to act as proxies for measuring how well the economy was accomplishing its stated purpose, which is to improve the standard of living for everyone.
Understanding that these metrics are simply proxies has been lost today, and they’ve been turned into goals of themselves. People have started treating these metrics as the economy. This is why we’re seeing an increasing disconnect between the economy that people are experiencing in their daily lives and news reporting on how the economy is doing.
And why we see absurd articles like this one arguing that the recession people are experiencing isn’t real.
I get the impression that the difference in China is that the government does understand the purpose of an economy, and hence why we see different outcomes there.
A lot of this covers economic growth that I don’t think is really covered in the US. People making $7.25 in 2009 can very well be making $7.25 today as the minimum wage hasn’t gone up. Healthcare, education, and housing aren’t more obtainable now yet they are absolutely crucial for a society.
But when I hear “the economy” being talked about it’s either low unemployment (which is really just a survey of Americans on if they’ve applied for a job) or about stock values (which are predominantly owned by the very wealthy) going up.
What good is an economy if you can’t afford the things you need?
Citations Needed podcast:
I’ll try to remember to listen to these but I get so scatter-brained I might forget. Thank you.
I get the impression that a lot of people in the west fundamentally fail to understand what the purpose of an economy actually is. An economy is a model for allocating labour and resources in a way that meets the needs of the people in the country.
The original argument for capitalism was that market economy with private ownership is the most effective way to allocate labour and resources in a way that benefits everyone. Measures such as jobs creation, the stock market, and GDP were meant to act as proxies for measuring how well the economy was accomplishing its stated purpose, which is to improve the standard of living for everyone.
Understanding that these metrics are simply proxies has been lost today, and they’ve been turned into goals of themselves. People have started treating these metrics as the economy. This is why we’re seeing an increasing disconnect between the economy that people are experiencing in their daily lives and news reporting on how the economy is doing.
And why we see absurd articles like this one arguing that the recession people are experiencing isn’t real.
https://www.wsj.com/economy/it-wont-be-a-recession-it-will-just-feel-like-one-1919267a
I get the impression that the difference in China is that the government does understand the purpose of an economy, and hence why we see different outcomes there.