I'd be interested in views on this.
Some of them I could predict now. Green would almost certainly say growth is bad because it can't help impacting negatively on the biosphere.

Increased prosperity for all can only come from growth. That includes the possibility for increasing the communal transfer of prosperity to disadvantaged groups. It also includes the inevitability of some people achieving ever increasing wealth. That's something you could only prevent by having an almost police state which of itself would strangle growth to a greater or less degree.

Or would you put so many caveats on the ambition towards economic growth that it likely wouldn't happen at all.

Discuss - 30 marks

The truth is that it is probably overrated and a stable position would be a good long term goal however the reality is that we are geared to need substantial growth to pay for the stuff we bought that we couldn't really afford to pay for.

[ GDP growth% - Productivity growth% ] > Population Growth %

If this doesn't happen society is going backwards.

If productivity growth % > GDP growth %, this implies deflation.

bogarde73 wrote on Dec 2^nd, 2015 at 3:41pm:

I'd be interested in views on this. Some of them I could predict now. Green would almost certainly say growth is bad because it can't help impacting negatively on the biosphere. Increased prosperity for all can only come from growth. That includes the possibility for increasing the communal transfer of prosperity to disadvantaged groups. It also includes the inevitability of some people achieving ever increasing wealth. That's something you could only prevent by having an almost police state which of itself would strangle growth to a greater or less degree. Or would you put so many caveats on the ambition towards economic growth that it likely wouldn't happen at all. Discuss - 30 marks

I don't think it is "good per se". I think that it can lead to a lot of good things. In terms of the reference to the environment, thinking as though it is separate to the economy is a narrow view.

While economic growth can be beneficial, short term growth at the expense of a longer growth cycle can be detrimental.

There is nothing inherently wrong with people continuing to gain wealth, but it is dangerous when that wealth concentrates in a smaller and smaller number of hands. It limits who gains the benefits of growth and it generates risk.

bogarde73 wrote on Dec 2^nd, 2015 at 3:41pm:

I'd be interested in views on this. Some of them I could predict now. Green would almost certainly say growth is bad because it can't help impacting negatively on the biosphere. Increased prosperity for all can only come from growth. That includes the possibility for increasing the communal transfer of prosperity to disadvantaged groups. It also includes the inevitability of some people achieving ever increasing wealth. That's something you could only prevent by having an almost police state which of itself would strangle growth to a greater or less degree. Or would you put so many caveats on the ambition towards economic growth that it likely wouldn't happen at all. Discuss - 30 marks

Walt Rostow defined economic development as "the march of compound interest". Interest encourages people to save, which gets invested back into the economy. Interest requires economic growth, but as Rostow showed, economic growth requires savings, or surplus capital. People on substance incomes have no way of saving for their old age, and cash economies with a majority of subsistence labourers have no way of building roads, cities, investing in health and education, etc.

Therefore, a level of growth is essential for economic development, but growth alone is merely economic activity. It doesn't define the quality or scope of that activity. War is a great economic stimulus, but it's hardly a social good. Under Bush W's administration, the military was largely privatized, creating a short-term stimulus after the recession of the early 2000s. The invasion of Afghanistan and Iraq were part of this plan.

Today, however, the US is in debt for trillions, largely money owed to China, the world’s new centre of manufacturing.

China, by comparison, has developed by pump-priming its own economy. There, the march to compound interest does not fully apply as Chinese banks offer next to no interest. China's growth has relied largely on its government bankrolling Communist Party friends. These friends have built China's new cities, the largest stimulus program in history - perhaps second only to the building of the Great Wall. Our own growth has been inextricably tied to China's, and this boom is now at an end. China’s stimulus is over.

China will need to decide whether to allow competition in its financial sector and allow the march of compound interest to hit the masses. This would require huge financial reforms, including de-pegging the Yuan from the US dollar and shaping far more liberal foreign and domestic investment policies.

Sun Tzu wrote on Dec 2^nd, 2015 at 4:02pm:

[ GDP growth% - Productivity growth% ] > Population Growth % If this doesn't happen society is going backwards. If productivity growth % > GDP growth %, this implies deflation.

You have 3 variables all with finite limits ? Looks like a recipe that has to end in disaster ?

Guess we are all hoping that we aren't still playing the game when the music stops ?

Dnarever wrote on Dec 2^nd, 2015 at 4:16pm:

Sun Tzu wrote on Dec 2nd, 2015 at 4:02pm: [ GDP growth% - Productivity growth% ] > Population Growth % If this doesn't happen society is going backwards. If productivity growth % > GDP growth %, this implies deflation. You have 3 variables all with finite limits ? Looks like a recipe that has to end in disaster ? Guess we are all hoping that we aren't still playing the game when the music stops ?

shallow level: without growth, no job, more crime, unstable society.

mid-level: without growth, either wealth doesn't flow at all, or we all become enemies. success = robbery. morality crashes.

deep-level: every living thing grows, grass, trees, animals, against growth is against human nature, it is equivalent to terrorism.

That is a hard question to answer solely based on growth, which neo-liberalism teaches us is the pinnacle of business.

Of course growth is good it leads to prosperity for most of the people in that country where growth is being experienced.

The problem is the current economic climate advantages corporations rather than the countries these corporations have established themselves in.

For example our jobs are slowly being transferred to low cost centres in India and China, these days corporations want their headquarters to be here in Australia so there CEO's and upper management can live the grand old life in the midst of civilization while all the work gets done in these low cost centres.

Also some of these corporations want the work or services to be done in Australia with a foreign work force.

Now I don't know about you guys but I think if the business claims to be Australian it should be based in Australia with an Australian work force.

Another thing, our government should p!ss of the privately owned Rothschild Central bank (RBA) and form its own.

Where it can cut money for the economy and its consumers without having to pay interest on that money, our government has the power to do this, yet it lets our RBA be owned by international bankers who them control our country.

Geez I could go on but this question is more than the growth of the economy, its like taking an equation out of a formulae ten miles long, unfortunately you have to deal with the whole rather than one small piece.

Ajax wrote on Dec 2^nd, 2015 at 5:18pm:

That is a hard question to answer solely based on growth, which neo-liberalism teaches us is the pinnacle of business. Of course growth is good it leads to prosperity for most of the people in that country where growth is being experienced. The problem is the current economic climate advantages corporations rather than the countries these corporations have established themselves in. For example our jobs are slowly being transferred to low cost centres in India and China, these days corporations want their headquarters to be here in Australia so there CEO's and upper management can live the grand old life in the midst of civilization while all the work gets done in these low cost centres. Also some of these corporations want the work or services to be done in Australia with a foreign work force. Now I don't know about you guys but I think if the business claims to be Australian it should be based in Australia with an Australian work force. Another thing, our government should p!ss of the privately owned Rothschild Central bank (RBA) and form its own. Where it can cut money for the economy and its consumers without having to pay interest on that money, our government has the power to do this, yet it lets our RBA be owned by international bankers who them control our country. Geez I could go on but this question is more than the growth of the economy, its like taking an equation out of a formulae ten miles long, unfortunately you have to deal with the whole rather than one small piece.

it's like a day dream. what you want to fight against is globalization, it's a great historical trend for next hundreds of years, which already started when Australia was found. if you like youself and your children and grand children to live well with it, you need to support and benefit from it. otherwise, you may win for a while, eventually, you will lose. no person nor a country can stop the history from moving forward.

Well, let me simply state that everything has limits, as we are now in the process of finding out, on a "few" fronts!

Here is a good current article on growth which postulates that without growth there would be more competition for resources including more war.

So perhaps growth is a trade-off against competition for resources.

The tenor of the article is that the world is doomed by human greed.

http://www.nytimes.com/2015/12/02/business/economy/imagining-a-world-without-growth.html?google_editors_picks=true&_r=0


Quote:

Could the world order survive without growing? It’s hard to imagine now, but humanity made do with little or no economic growth for thousands of years. In Byzantium and Egypt, income per capita at the end of the first millennium was lower than at the dawn of the Christian Era. Much of Europe experienced no growth at all in the 500 years that preceded the Industrial Revolution. In India, real incomes per person shrank continuously from the early 17th through the late 19th century. As world leaders gather in Paris to hash out an agreement to hold down and ultimately stop the emissions of heat-trapping greenhouse gases that threaten to make Earth increasingly inhospitable for humanity, there is a question that is unlikely to be openly discussed at the two-week conclave convened by the United Nations. But it is nonetheless hanging in the air: Could civilization, as we know it, survive such an experience again? The answer, simply, is no. Economic growth took off consistently around the world only some 200 years ago. Two things powered it: innovation and lots and lots of carbon-based energy, most of it derived from fossil fuels like coal and petroleum. Staring at climactic upheaval approaching down the decades, environmental advocates, scientists and even some political leaders have put the proposal on the table: World consumption must stop growing. “This is a subtle and largely unacknowledged part of some folks’ environmental/climate plan,” said Michael Greenstone, who directs the Energy Policy Institute at the University of Chicago. Sometimes it is not so subtle. The Stanford ecologist Paul Ehrlich has been arguing for decades that we must slow both population and consumption growth. When I talked to him on the phone a few months ago, he quoted the economist Kenneth Boulding: “Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist.” The proposal that growth must stop appears frequently along the leftward edge of the environmental movement, in publications like Dissent and the writing of the environmental advocate Bill McKibben. It also shows up in academic literature. For instance, Peter Victor of York University in Canada published a study titled “Growth, degrowth and climate change: A scenario analysis,” in which he compared Canadian carbon emissions under three economic paths to the year 2035. The Carbon Era Economic growth has taken hold across the world over the last 200 years, fueled by innovation and fossil fuels that contribute to global warming. Limiting growth to zero, he found, had a modest impact on carbon spewed into the air. Only the “de-growth” situation — in which Canadians’ income per person shrank to its level in 1976 and the average working hours of employed Canadians declined by 75 percent — managed to slash emissions in a big way. And it is creeping into international diplomacy, showing up forcefully in India’s demand for “carbon space” from the rich world, which at its logical limit would demand that advanced nations deliver negative emissions — suck more carbon out of the atmosphere than they put in — so the world’s poor countries could burn their way to development as the rich countries have done for the last two centuries. Working for the Sustainable Development Commission, set up in 2001 to advise the Labour government in Britain, Tim Jackson of the University of Surrey produced a nifty calculation. Accept that citizens of developing nations are entitled to catch up with the living standards of Europeans by midcentury, and assume that Europe will grow, on average, by 2 percent a year between now and then. To stay within the 2 degree Centigrade (3.6 degrees Fahrenheit) average temperature increase that scientists generally consider the upper bound to avoid catastrophic climate change would require the world economy in 2050 to emit no more than six grams of carbon dioxide for every dollar of economic output. To put that in perspective, today the United States economy emits 60 times that much. The French economy, one of the most carbon-efficient because it is powered extensively by nuclear energy, emits 150 grams per dollar of output. A stream of cars backs up on a highway exit in New Delhi. Emerging markets like India are demanding "carbon space" to allow their economies to grow. Credit Roberto Schmidt/Agence France-Presse — Getty Images Drawing what he saw as the inevitable conclusion, Professor Jackson published a book in 2009 called “Prosperity Without Growth” (Earthscan/Routledge). Whatever the ethical merits of the case, the proposition of no growth has absolutely no chance to succeed. For all the many hundreds of years humanity survived without growth, modern civilization could not. The trade-offs that are the daily stuff of market-based economies simply could not work in a zero-sum world.... article has more

An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy.

perceptions_now wrote on Dec 2^nd, 2015 at 6:22pm:

Well, let me simply state that everything has limits, as we are now in the process of finding out, on a "few" fronts!

Yes, everything has a limit, but doen't mean you find and stop there. You can find new way, new direction from it. When you were young, did you think about there will be something called Google? the best thing/limit is a big library.

issuevoter wrote on Dec 2^nd, 2015 at 6:50pm:

An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy.

You forgot moon landing, forgot discovery of America and Austrlia. old way has its limit, but you can always find new way. Up to now, it seems we have not found the limit to create new ways.

I'm so suprised most people in this country has such limited and narrow view. You see, most topics here are religion and terrorism. Or only 1 topic, it's anti-musilm through religious self identifying.

beer wrote on Dec 2^nd, 2015 at 6:52pm:

perceptions_now wrote on Dec 2nd, 2015 at 6:22pm: Well, let me simply state that everything has limits, as we are now in the process of finding out, on a "few" fronts! Yes, everything has a limit, but doen't mean you find and stop there. You can find new way, new direction from it. When you were young, did you think about there will be something called Google? the best thing/limit is a big library.

Sorry, I was a bit rushed earlier!
I should have mentioned that the major Drivers of Economic Growth, particularly in the Modern era, were -
1) Demographics - Continuing Population Growth, which was the number 1 driver of Economic Growth, as it was the backstop that ensured Growth would always return.
2) Energy - This has also been a major driver, given that it became readily available, at cheap prices & Supply kept up with Population Growth.
3) Climate - We have had a substantially "Goldilocks Global Climate", for the last 200 years & that has enabled the Population Growth to expand, at very high levels.
4) Innovation - This was also a major driver, enabling more to be done with less. However, like everything, there are limits to doing more with less, even in Economics, as we will now find out.

All other Economic measures, revolve around the above 4 basics!

That said, innovation is now our last, great hope, BUT I would not rely on Innovation, for last minute outcomes, as good public policy & at this point there is nothing on the horizon, which would remotely suggest a good outcome! 

So, is economic growth good per se?
The likely answer is, it had its place, But now it is likely to be a fading memory!

Ajax wrote on Dec 2^nd, 2015 at 5:18pm:

That is a hard question to answer solely based on growth, which neo-liberalism teaches us is the pinnacle of business. Of course growth is good it leads to prosperity for most of the people in that country where growth is being experienced. The problem is the current economic climate advantages corporations rather than the countries these corporations have established themselves in. For example our jobs are slowly being transferred to low cost centres in India and China, these days corporations want their headquarters to be here in Australia so there CEO's and upper management can live the grand old life in the midst of civilization while all the work gets done in these low cost centres. Also some of these corporations want the work or services to be done in Australia with a foreign work force. Now I don't know about you guys but I think if the business claims to be Australian it should be based in Australia with an Australian work force. Another thing, our government should p!ss of the privately owned Rothschild Central bank (RBA) and form its own. Where it can cut money for the economy and its consumers without having to pay interest on that money, our government has the power to do this, yet it lets our RBA be owned by international bankers who them control our country. Geez I could go on but this question is more than the growth of the economy, its like taking an equation out of a formulae ten miles long, unfortunately you have to deal with the whole rather than one small piece.

We no longer have any way of achieving a foothold for Australia or Australian jobs, Ajax. Tariffs are gone, we’ve got a floating dollar, we have a privatised - and globalised - economy.

No.worries. This just requires a new focus. While the nation state still exists, production is global. Those who manufacture our goods, grow much of our food and even answer our phones are foreign.

This raises a fundamental ethical question. Why should they be paid less that us? Why is our entire economy based on cheap Chinese, Bangladeshi, Indian and Philippino labour when we have the second best standard of living in the world?

Nation states are no longer economic units. In fact, they never were. Australia has always been part of an empire, an arms race, and now a region. Our goods come from dollar a day labourers in Asia, just as during the British empire, they were made by triangular trade - slave-picked cotton from Amerika, Indian-manufactured cloth and European-sewn clothes.

The only way to run a world is to share the goods, the labour, the energy, and the space.

To be honest, I’m not sure if this will ever happen. The only way the world has ever been run is through slavery, in one form or another.

perceptions_now wrote on Dec 2^nd, 2015 at 7:36pm:

beer wrote on Dec 2nd, 2015 at 6:52pm: perceptions_now wrote on Dec 2nd, 2015 at 6:22pm: Well, let me simply state that everything has limits, as we are now in the process of finding out, on a "few" fronts! Yes, everything has a limit, but doen't mean you find and stop there. You can find new way, new direction from it. When you were young, did you think about there will be something called Google? the best thing/limit is a big library. Sorry, I was a bit rushed earlier! I should have mentioned that the major Drivers of Economic Growth, particularly in the Modern era, were - 1) Demographics - Continuing Population Growth, which was the number 1 driver of Economic Growth, as it was the backstop that ensured Growth would always return. 2) Energy - This has also been a major driver, given that it became readily available, at cheap prices & Supply kept up with Population Growth. 3) Climate - We have had a substantially "Goldilocks Global Climate", for the last 200 years & that has enabled the Population Growth to expand, at very high levels. 4) Innovation - This was also a major driver, enabling more to be done with less. However, like everything, there are limits to doing more with less, even in Economics, as we will now find out. All other Economic measures, revolve around the above 4 basics! That said, innovation is now our last, great hope, BUT I would not rely on Innovation, for last minute outcomes, as good public policy & at this point there is nothing on the horizon, which would remotely suggest a good outcome!  So, is economic growth good per se? The likely answer is, it had its place, But now it is likely to be a fading memory!

Thanks for the above thoughtful comments, but I can not agree with points other than demographics.

All other 3 can be counted with knowledge(social/scientific)/technologies/innovation, only the demographics is driven by instinct.

1. Definition of energy has been changed time by time, price of energy has changed more often.
400 years ago, I guess even coal was not really widely used as energy source for production activities until steam engine was invented. Oil got more important only after car and chemical industry developed. Nowadays, we have more broader definition of energy which can be used, e.g. nuclear power, solar energy.
The price of energy is also driven by technology improvement, most recent example was excavation of shale gas. Thanks to it, oil is below $50 now.

2. I don't know what the theory behind recent 200 years of climate conditions, I guess what you mean was food supply or living related living conditions. Without farming technology improvement like widely used fertilizers and insecticide, I don't think current climate has too much contribution to food supply. I can took an example how Isrial grows vegetables on desert, how cucumber can be supplied under -20 degrees in greenhouse in Sebiria. Food price actually hasn't grown too much in many years, doesn't matter how bad was the weather in each year. Thanks to modern transportation and storage techs as well. In terms of living, Dubai is a very good example how a million people can live luxury in desert climate, though many poor labors have very bad conditions, but to be able to work there in +50 degrees, it's already a miracle.

3. Innovation is now only in technology, but also in social management. There are lots of work process and daily living habits did not exist 50 years ago. e.g shopping online, international travel was as cheap as today, laws take care of more details in daily things, politicians become more difficult to cheat public. :-)

So, I can see it's brighter in tomorrow, people need to be optimistic but not be fooled by those politicians. Terrorism comparing to ww2, cold war and today's environmental challenge, cultural conflicts are just nothing. The world is far from the end and judgement day. The limit of growth is completely not visible in next hundred years, lots of things can be done, very long list. 

Dnarever wrote on Dec 2^nd, 2015 at 4:16pm:

Sun Tzu wrote on Dec 2nd, 2015 at 4:02pm: [ GDP growth% - Productivity growth% ] > Population Growth % If this doesn't happen society is going backwards. If productivity growth % > GDP growth %, this implies deflation. You have 3 variables all with finite limits ? Looks like a recipe that has to end in disaster ? Guess we are all hoping that we aren't still playing the game when the music stops ?

perception believes world population will decrease to 3-4 billion so that sort of ruin that equation for everyone

Karnal wrote on Dec 2^nd, 2015 at 8:48pm:

Ajax wrote on Dec 2nd, 2015 at 5:18pm: That is a hard question to answer solely based on growth, which neo-liberalism teaches us is the pinnacle of business. Of course growth is good it leads to prosperity for most of the people in that country where growth is being experienced. The problem is the current economic climate advantages corporations rather than the countries these corporations have established themselves in. For example our jobs are slowly being transferred to low cost centres in India and China, these days corporations want their headquarters to be here in Australia so there CEO's and upper management can live the grand old life in the midst of civilization while all the work gets done in these low cost centres. Also some of these corporations want the work or services to be done in Australia with a foreign work force. Now I don't know about you guys but I think if the business claims to be Australian it should be based in Australia with an Australian work force. Another thing, our government should p!ss of the privately owned Rothschild Central bank (RBA) and form its own. Where it can cut money for the economy and its consumers without having to pay interest on that money, our government has the power to do this, yet it lets our RBA be owned by international bankers who them control our country. Geez I could go on but this question is more than the growth of the economy, its like taking an equation out of a formulae ten miles long, unfortunately you have to deal with the whole rather than one small piece. We no longer have any way of achieving a foothold for Australia or Australian jobs, Ajax. Tariffs are gone, we’ve got a floating dollar, we have a privatised - and globalised - economy. No.worries. This just requires a new focus. While the nation state still exists, production is global. Those who manufacture our goods, grow much of our food and even answer our phones are foreign. This raises a fundamental ethical question. Why should they be paid less that us? Why is our entire economy based on cheap Chinese, Bangladeshi, Indian and Philippino labour when we have the second best standard of living in the world? Nation states are no longer economic units. In fact, they never were. Australia has always been part of an empire, an arms race, and now a region. Our goods come from dollar a day labourers in Asia, just as during the British empire, they were made by triangular trade - slave-picked cotton from Amerika, Indian-manufactured cloth and European-sewn clothes. The only way to run a world is to share the goods, the labour, the energy, and the space. To be honest, I’m not sure if this will ever happen. The only way the world has ever been run is through slavery, in one form or another.

;D Globalization is completely new form of slavery, I fully agree.
Elites from worldwide are uniting to slave all kinds of people from any country, any ethnic group and any religion. You join or not, it's a question.

You talk about globalisation and slavery

But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery

So you prefer that?

If so - let's check with these people who are grateful to have a job first

beer wrote on Dec 2^nd, 2015 at 6:56pm:

issuevoter wrote on Dec 2nd, 2015 at 6:50pm: An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy. You forgot moon landing, forgot discovery of America and Austrlia. old way has its limit, but you can always find new way. Up to now, it seems we have not found the limit to create new ways. I'm so suprised most people in this country has such limited and narrow view. You see, most topics here are religion and terrorism. Or only 1 topic, it's anti-musilm through religious self identifying.

Your confused tenses and syntax make it very difficult  to understand your meaning. I did not forget the things you refer to, they are implied.

Maqqa wrote on Dec 2^nd, 2015 at 9:41pm:

You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first

I'm not a protester to globalization, but a supporter. But the fact is that is a new form of slavery, that's true.

The world history is a slavery history, only naive people believe they are the boss, but not politicians and super riches, king/queen/pope, etc.

So arguing to keep a dish washing job in Australia or in China, it is meaningless discussion.
People lose jobs in developed countries to China is because: first their currencies are over valued, secondly Chinese currency is too much lower valued, that's it. The valuer is "global elites' union", this setting benefits only them.

issuevoter wrote on Dec 2^nd, 2015 at 9:56pm:

beer wrote on Dec 2nd, 2015 at 6:56pm: issuevoter wrote on Dec 2nd, 2015 at 6:50pm: An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy. You forgot moon landing, forgot discovery of America and Austrlia. old way has its limit, but you can always find new way. Up to now, it seems we have not found the limit to create new ways. I'm so suprised most people in this country has such limited and narrow view. You see, most topics here are religion and terrorism. Or only 1 topic, it's anti-musilm through religious self identifying. Your confused tenses and syntax make it very difficult  to understand your meaning. I did not forget the things you refer to, they are implied.

Thanks to point it out, tense is not in my native language, so it's a hard part for me.

beer wrote on Dec 2^nd, 2015 at 10:02pm:

Maqqa wrote on Dec 2nd, 2015 at 9:41pm: You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first I'm not a protester to globalization, but a supporter. But the fact is that is a new form of slavery, that's true. The world history is a slavery history, only naive people believe they are the boss, but not politicians and super riches, king/queen/pope, etc. So arguing to keep a dish washing job in Australia or in China, it is meaningless discussion. People lose jobs in developed countries to China is because: first their currencies are over valued, secondly Chinese currency is too much lower valued, that's it. The valuer is "global elites' union", this setting benefits only them.

But these people's lives are better off

Maqqa wrote on Dec 2^nd, 2015 at 9:41pm:

You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first

These people?

Karnal wrote on Dec 2^nd, 2015 at 10:06pm:

Maqqa wrote on Dec 2nd, 2015 at 9:41pm: You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first These people?

The so-called slaves

Maqqa wrote on Dec 2^nd, 2015 at 10:08pm:

Karnal wrote on Dec 2nd, 2015 at 10:06pm: Maqqa wrote on Dec 2nd, 2015 at 9:41pm: You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first These people? The so-called slaves

Not us, you mean?

Maqqa wrote on Dec 2^nd, 2015 at 9:41pm:

You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first

That reads like a complacent bourgeois simplification to me. So globalization is the panacea of the worlds ecomomic and social woes? Globalisation has always been about cheap labour for industrialists. When we have forgotten how to make anything, cheap goods will get expensive.

issuevoter wrote on Dec 2^nd, 2015 at 6:50pm:

An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy.

Two things I would say here:
1. I don't believe in finite resources. How can we ever say we know what resources exist or what combinations of resources will in the future meet expanding needs
2. As the income of the developing world rises, as I think is the case in many places, experience shows us that pop growth slows and I believe this is happening already.

bogarde73 wrote on Dec 3^rd, 2015 at 7:01am:

issuevoter wrote on Dec 2nd, 2015 at 6:50pm: An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy. Two things I would say here: 1. I don't believe in finite resources. How can we ever say we know what resources exist or what combinations of resources will in the future meet expanding needs 2. As the income of the developing world rises, as I think is the case in many places, experience shows us that pop growth slows and I believe this is happening already.

Resources are finite, Bogie. What’s not finite is ideas.

If we could cultivate renewable energy,.we wouldn’t need any resources at all. We could become a service economy with,yes, endless growth. The internet has made this posdible. Music and films are delivered over the wire. We don’t even need a retail sector anymore.

But we would still require manufactured goods. The problem with out "growth" is that it comes on the back of cheap labour. Eventually, Chinese wages will rise, and there goes all that cheap stuff.

Growth requires our terms of trade to be good. I.e, we need to export more than we import. If we don’t get our economy going after the mining boom, we will become a banana republic agsin.

Nation states have come to specialise. China does manufacturing, the US does patents and intellectual property. The UK still does financial services.

Australia’s days as a mine are numbered.

Maqqa wrote on Dec 2^nd, 2015 at 9:41pm:

You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first

Globalisation is inevitable, given the conditions that exist (population size, technology etc).

Standards of living are being increased around the world, and while there is exploitation, generally things are improving and people becoming more affluent. That could change though, and it by no means certain.

Karnal wrote on Dec 3^rd, 2015 at 8:00am:

bogarde73 wrote on Dec 3rd, 2015 at 7:01am: issuevoter wrote on Dec 2nd, 2015 at 6:50pm: An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy. Two things I would say here: 1. I don't believe in finite resources. How can we ever say we know what resources exist or what combinations of resources will in the future meet expanding needs 2. As the income of the developing world rises, as I think is the case in many places, experience shows us that pop growth slows and I believe this is happening already. Resources are finite, Bogie. What’s not finite is ideas. If we could cultivate renewable energy,.we wouldn’t need any resources at all. We could become a service economy with,yes, endless growth. The internet has made this posdible. Music and films are delivered over the wire. We don’t even need a retail sector anymore. But we would still require manufactured goods. The problem with out "growth" is that it comes on the back of cheap labour. Eventually, Chinese wages will rise, and there goes all that cheap stuff. Growth requires our terms of trade to be good. I.e, we need to export more than we import. If we don’t get our economy going after the mining boom, we will become a banana republic agsin. Nation states have come to specialise. China does manufacturing, the US does patents and intellectual property. The UK still does financial services. Australia’s days as a mine are numbered.

The primary level education is too bad here. How much can a primary school teacher earn? I think not very good, then you can not attract good people to work in this area. Country's resources are all directed to lawyers and doctors kind of jobs. Those jobs don't provide too much real values. You can search for numbers, how many healthcare workers you have per 100,000 population? It's very high even in developed countries. But what's the outcome of their services? I remember the number of total healthcare services in NSW was pretty low. I asked a lawyer about the fees to win a business case. The answer was you never want to get into such a trouble. What? you can not expect any justice here, because you can not afford the legal cost? Then how can then society benefits from legal system? That's why angry people are everywhere, if no justice can be provided efficiently.

The 'anti-growth' rhetoric from so many of you mirrors your personal philosophy. How many of you have 'grown' in the last 20 years? Studied anything? Started a business, developed new skills? Or are you just the same person you were 20 years ago, just older?

If you understand and promote personal growth then the concept of economic growth makes perfect sence. But if you stopped growing and improving then you would expect the rest of the world to go in a holding-pattern with you.  But it won't. Ever.

beer wrote on Dec 3^rd, 2015 at 8:32am:

Karnal wrote on Dec 3rd, 2015 at 8:00am: bogarde73 wrote on Dec 3rd, 2015 at 7:01am: issuevoter wrote on Dec 2nd, 2015 at 6:50pm: An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy. Two things I would say here: 1. I don't believe in finite resources. How can we ever say we know what resources exist or what combinations of resources will in the future meet expanding needs 2. As the income of the developing world rises, as I think is the case in many places, experience shows us that pop growth slows and I believe this is happening already. Resources are finite, Bogie. What’s not finite is ideas. If we could cultivate renewable energy,.we wouldn’t need any resources at all. We could become a service economy with,yes, endless growth. The internet has made this posdible. Music and films are delivered over the wire. We don’t even need a retail sector anymore. But we would still require manufactured goods. The problem with out "growth" is that it comes on the back of cheap labour. Eventually, Chinese wages will rise, and there goes all that cheap stuff. Growth requires our terms of trade to be good. I.e, we need to export more than we import. If we don’t get our economy going after the mining boom, we will become a banana republic agsin. Nation states have come to specialise. China does manufacturing, the US does patents and intellectual property. The UK still does financial services. Australia’s days as a mine are numbered. The primary level education is too bad here. How much can a primary school teacher earn? I think not very good, then you can not attract good people to work in this area. Country's resources are all directed to lawyers and doctors kind of jobs. Those jobs don't provide too much real values. You can search for numbers, how many healthcare workers you have per 100,000 population? It's very high even in developed countries. But what's the outcome of their services? I remember the number of total healthcare services in NSW was pretty low. I asked a lawyer about the fees to win a business case. The answer was you never want to get into such a trouble. What? you can not expect any justice here, because you can not afford the legal cost? Then how can then society benefits from legal system? That's why angry people are everywhere, if no justice can be provided efficiently.

Do you want to try that again, but in English? And when you are sober?

issuevoter wrote on Dec 2^nd, 2015 at 10:44pm:

Maqqa wrote on Dec 2nd, 2015 at 9:41pm: You talk about globalisation and slavery But without globalisation there would be less likely chance of these people being employed and it would be even worse than slavery So you prefer that? If so - let's check with these people who are grateful to have a job first That reads like a complacent bourgeois simplification to me. So globalization is the panacea of the worlds ecomomic and social woes? Globalisation has always been about cheap labour for industrialists. When we have forgotten how to make anything, cheap goods will get expensive.

What's the alternative?

We give them jobs and their lives are better

By panacea you want to bring them up to our standard of living immediately?

That's not going to happen in ANY society!

mariacostel wrote on Dec 3^rd, 2015 at 9:14am:

beer wrote on Dec 3rd, 2015 at 8:32am: Karnal wrote on Dec 3rd, 2015 at 8:00am: bogarde73 wrote on Dec 3rd, 2015 at 7:01am: issuevoter wrote on Dec 2nd, 2015 at 6:50pm: An ever expanding economy is impossible in a world of finite resources. It seems an unlimited expanding population must pass a point where chaos takes charge. However, no generation has predicted the future with any accuracy. Two things I would say here: 1. I don't believe in finite resources. How can we ever say we know what resources exist or what combinations of resources will in the future meet expanding needs 2. As the income of the developing world rises, as I think is the case in many places, experience shows us that pop growth slows and I believe this is happening already. Resources are finite, Bogie. What’s not finite is ideas. If we could cultivate renewable energy,.we wouldn’t need any resources at all. We could become a service economy with,yes, endless growth. The internet has made this posdible. Music and films are delivered over the wire. We don’t even need a retail sector anymore. But we would still require manufactured goods. The problem with out "growth" is that it comes on the back of cheap labour. Eventually, Chinese wages will rise, and there goes all that cheap stuff. Growth requires our terms of trade to be good. I.e, we need to export more than we import. If we don’t get our economy going after the mining boom, we will become a banana republic agsin. Nation states have come to specialise. China does manufacturing, the US does patents and intellectual property. The UK still does financial services. Australia’s days as a mine are numbered. The primary level education is too bad here. How much can a primary school teacher earn? I think not very good, then you can not attract good people to work in this area. Country's resources are all directed to lawyers and doctors kind of jobs. Those jobs don't provide too much real values. You can search for numbers, how many healthcare workers you have per 100,000 population? It's very high even in developed countries. But what's the outcome of their services? I remember the number of total healthcare services in NSW was pretty low. I asked a lawyer about the fees to win a business case. The answer was you never want to get into such a trouble. What? you can not expect any justice here, because you can not afford the legal cost? Then how can then society benefits from legal system? That's why angry people are everywhere, if no justice can be provided efficiently. Do you want to try that again, but in English? And when you are sober?

Never back to school, never wake from drunken ;D

Where you say slavery Karnal, I say comparative advantage, which is a flexible relationship that will evolve in ways we haven't imagined yet.

And I agree with Macca's point: ask the people of Bangladesh, are they happy with the work that's come their way at this point or would they still prefer a more subsistence existence in the paddy fields, subject to the whims of typhoons and so forth.

Resources are finite in the sense that no more rocks are being manufactured, although even that's debatable. But what I mean is we don't know what elements or compounds still remain to be understood in terms of their full utility. And as I think beer mentioned, an infinite and as yet not understood resource is human cooperation. You could add to that imagination and the expansion of the mind.

There is no limit to growth until the sun does its thing and maybe even not then.

mariacostel wrote on Dec 3^rd, 2015 at 8:53am:

The 'anti-growth' rhetoric from so many of you mirrors your personal philosophy. How many of you have 'grown' in the last 20 years? Studied anything? Started a business, developed new skills? Or are you just the same person you were 20 years ago, just older? If you understand and promote personal growth then the concept of economic growth makes perfect sence. But if you stopped growing and improving then you would expect the rest of the world to go in a holding-pattern with you.  But it won't. Ever.

Yes, dear, but you went to private school, so you don’t need any more study.

Longy could have done a PhD in maths, but the professors were all IDIOTS.

Karnal wrote on Dec 3^rd, 2015 at 10:20am:

mariacostel wrote on Dec 3rd, 2015 at 8:53am: The 'anti-growth' rhetoric from so many of you mirrors your personal philosophy. How many of you have 'grown' in the last 20 years? Studied anything? Started a business, developed new skills? Or are you just the same person you were 20 years ago, just older? If you understand and promote personal growth then the concept of economic growth makes perfect sence. But if you stopped growing and improving then you would expect the rest of the world to go in a holding-pattern with you.  But it won't. Ever. Yes, dear, but you went to private school, so you don’t need any more study. Longy could have done a PhD in maths, but the professors were all IDIOTS.

Don't say that, not all professors are IDIOTS, I think if they used to work in real business or advanced research environment, had good achievements, before retirement, go back to uni to pass their knowledge and experience to young people, they are good professors. Only those who always stay in uni since graduated, then waited for many years in a queue and become professors for a good income are idiots. (except people who really study hard in theoretical things)

bogarde73 wrote on Dec 3^rd, 2015 at 9:55am:

Where you say slavery Karnal, I say comparative advantage, which is a flexible relationship that will evolve in ways we haven't imagined yet. And I agree with Macca's point: ask the people of Bangladesh, are they happy with the work that's come their way at this point or would they still prefer a more subsistence existence in the paddy fields, subject to the whims of typhoons and so forth. Resources are finite in the sense that no more rocks are being manufactured, although even that's debatable. But what I mean is we don't know what elements or compounds still remain to be understood in terms of their full utility. And as I think beer mentioned, an infinite and as yet not understood resource is human cooperation. You could add to that imagination and the expansion of the mind. There is no limit to growth until the sun does its thing and maybe even not then.

The limits to growth are not just resources, Bogie, they’re financial. Consumers and governments have a finite amount of money to spend.

I believe it really depends on what kind of economy is growing, and that a country should gear towards growth in sectors that benefits it.

For example, ever increasing and expansion of money into real estate may not be good if its not geared towards producing new dwelling.   But keep increasing in price through easy credit on existing stock is just going to create bubbles that eventually have to burst.

Expansion in renewable energy sector is more preferable than non renewable, that is to prepare for the future. 

tickleandrose wrote on Dec 3^rd, 2015 at 11:56am:

I believe it really depends on what kind of economy is growing, and that a country should gear towards growth in sectors that benefits it. For example, ever increasing and expansion of money into real estate may not be good if its not geared towards producing new dwelling.   But keep increasing in price through easy credit on existing stock is just going to create bubbles that eventually have to burst.

True. You could say that existing dwellings are not technically GDP. All you're doing is passing a product from one person to another.

You could also say that real estate is negative growth. I.e, when you become a home-owner, you go into debt.

This issue alone is the big problem with the Australian economy. Per capita, Australians owe debt of 150% of their annual salaries - among the highest debt levels in the world.

By comparison, government debt is among the lowest in the OECD. It sits at around 20% of GDP, as opposed to US debt, which is over 100%.

The way we think about these two kinds of debt - public and private - is striking. We have come to believe that government debt is inherently bad, while household debt is somehow virtuous. Buying a home or maxing out your credit card through a bit of retail therapy: good. Government investment in schools, infrastructure, home insulation, etc: evil.

The housing boom is what currently keeps the eastern states awash with stamp duty revenue. The NSW Treasury is currently loaded thanks to the Sydney property market.

But the debt that fuels this boom leaves Australia in a very precarious situation. It would not take much to collapse, but what's more likely is a slow economic decline, driven by rising terms of trade and low wage growth. As our money is tied up in debt, less money gets spent and invested. With low interest rates, investment makes little profit. Much of that debt is foreign, so it goes back out of the country - with interest.

In the current economic environment, encouraging spending, as governments generally love to do, encourages debt. This shifts the burden of debt from the government onto the individual.

Mind you, if it works, businesses employ and wages rise. Wages and capital are finite, but demand is illusive. Governments can make small changes that have a big impact on business and consumer confidence, and this is the current Turnbull strategy.

Governments can increase revenue in a number of ways, but there are broadly three: cut services, raise taxes, or encourage growth. These strategies need to be balanced and applied to economic circumstances.

Take the Abbott approach. Abbott talked the economy down both in opposition, and then in government. He manufactured an economic crisis that he then meant to solve. The solution? Cuts to government services.

Abbott wasn't successful in getting his cuts through, but he created economic gloom, shadowed by the end of the mining boom and the dearth of manufacturing. In his next budget, Abbott did a reversal. His aim? To stimulate the economy through generous family payments and small business rebates. Abbott wanted small business to "have a go".

The mixed messages here confused business. Business groups had no idea where Abbott was going. It was clear that the Abbott government was purely reactive and had no long-term plan. This was one of the main reasons why Abbott was deposed.

The day after Abbott's sacking, the dollar rose by two cents. Surveys showed business confidence improving after only a few weeks. By doing absolutely nothing, Turnbull achieved a minor boost in confidence. It's difficult to measure so close to Christmas, but employment has also risen.

Government money in Australia accounts for around 25% of the economy, so small shifts in direction can have a huge impact. The Abbott government, with Joe Hockey as treasurer, was a textbook example on what governments should not do.

Just think how ludicrous Abbott and Hockey's message was about home ownership and wages. Abbott said that high house prices are good. Hockey followed up by saying the best way to afford a home is to get a higher paying job. Abbott ruled out changes to negative gearing or capital gains tax, which artificially stimulate house prices. By talking up a wages auction, Hockey was pushing for wages growth, which causes inflation (and higher interest rates) - as if this could even be possible, given employment levels.

The messages made no sense, but they were the government's message on home ownership. As Hockey acknowledged, the Abbott government failed to get its message across on so many different levels. There was no coherence, but ultimately, there was no shared purpose to begin with. The Abbott government was doomed by its own words in opposition. It could not possibly provide a solution after talking up the problem to such a degree. The Abbott government was hung by its own rope.

The Turnbull government has a task on its hands, but "paying off Labor's debt" is the least of its problems. Reducing private debt is crucial to getting the economy going again.

Why not cut the service price that government paid for?  like you said 1/3 GDP belongs to the gov, it only benefits a small amount of businesses and individuals. It's the side effect of mining boom, too much easy money before.

The government spending is not fairly redistributed back to tax payers. Contractors and sub-contractors got too much money but provided very limited services.

This unfair reallocation of wealth divided poor and rich further and further. So rich people buy more and more houses in ridiculous high price, they know they have nowhere to invest other than just buying properties.

Normal people stuck in their debts, dare not to change jobs, find new opportunities, they became slaves of high housing debts, which is created by government unfair paid high income groups. So consumer & retail market was always bad, normal businesses could not earn money, they also need to pay more budget fixing tax to riches. Dead loop.

beer wrote on Dec 3^rd, 2015 at 2:10pm:

The government spending is not fairly redistributed back to tax payers. Contractors and sub-contractors got too much money but provided very limited services. This unfair reallocation of wealth divided poor and rich further and further. So rich people buy more and more houses in ridiculous high price, they know they have nowhere to invest other than just buying properties.

Socialist and communist views - money is not meant to be redistributed fairly back to taxpayers. If it does then every $1 that a poor person gets - a rich person should get as well

Rich people are rich for a variety of reasons - you don't have to agree with how they got their money but why should they share more of their wealth with you?

This then goes to the "the rich can afford it". Affordability is subjective. If someone believes you can afford to pay more tax - then do they have the right to take that money from you?

I am not a strong advocate of this view

Maqqa wrote on Dec 3^rd, 2015 at 3:39pm:

Rich people are rich for a variety of reasons - you don't have to agree with how they got their money but why should they share more of their wealth with you?

The majority of the rich are rich due to market monopolies.

"Their" wealth? The richest companies are banks and super and hedge funds. Warren Buffett's wealth all comes from other people's money.

All capital comes from other people's money. People become rich due to government policies. They build their wealth through their ability to lobby and befriend governments. The world's richest are those granted monopolies by governments. Most of them are lent government money to do so.

Russian oligarchs, Chinese princelings, Saudi oil shieks - the wealthiest of these were lent money by their governments and granted monopolies. Many were given money by government-friendly banks - again, other people's money.

The same principle applies to airlines, casino developers, radio and TV stations, and on and on. If you think people become rich through hard work or smart ideas, good luck to you. The hardest and smartest workers throughout the world will never become rich through working and thinking. The rich, however, become wealthy through good fortune and key friendships. And they all do so using the money of other people.

This is precisely why they have a duty to share "their" money with us. That airline route, that mining lease, that casino or TV license or development approval - that belongs to all of us.

Karnal wrote on Dec 3^rd, 2015 at 4:04pm:

The majority of the rich are rich due to market monopolies. "Their" wealth? The richest companies are banks and super and hedge funds. Warren Buffett's wealth all comes from other people's money. All capital comes from other people's money. People become rich due to government policies. They build their wealth through their ability to lobby and befriend governments. The world's richest are those granted monopolies by governments. Most of them are lent government money to do so. Russian oligarchs, Chinese princelings, Saudi oil shieks - the wealthiest of these were lent money by their governments and granted monopolies. Many were given money by government-friendly banks - again, other people's money. The same principle applies to airlines, casino developers, radio and TV stations, and on and on. If you think people become rich through hard work or smart ideas, good luck to you. The hardest and smartest workers throughout the world will never become rich through working and thinking. The rich, however, become wealthy through good fortune and key friendships. And they all do so using the money of other people. This is precisely why they have a duty to share "their" money with us. That airline route, that mining lease, that casino or TV license or development approval - that belongs to all of us.

Where do I start with this mess

(1) If you understood how money is generated then you would not made the above comments. There are more money now than any other time in history. So how did it come about?

(2) Banks, Super moneys are mandate by governments. So they make money due to the monopolies created by the governments

(3) Hedge Funds are speculations - hint the word "hedge". It's like playing the casino.

(4) Oligarchs and princelings you refer to - they sold something to get money. So where did the money come from? And where did they get their money?

(5) The only "government friendly banks" are the Reserve Banks. Any money given to these people must be underpin by assets. Nothing is for free

(6) They have no duties to share because they are the ones who took the risks.

Maqqa wrote on Dec 3^rd, 2015 at 3:39pm:

beer wrote on Dec 3rd, 2015 at 2:10pm: The government spending is not fairly redistributed back to tax payers. Contractors and sub-contractors got too much money but provided very limited services. This unfair reallocation of wealth divided poor and rich further and further. So rich people buy more and more houses in ridiculous high price, they know they have nowhere to invest other than just buying properties. Socialist and communist views - money is not meant to be redistributed fairly back to taxpayers. If it does then every $1 that a poor person gets - a rich person should get as well Rich people are rich for a variety of reasons - you don't have to agree with how they got their money but why should they share more of their wealth with you? This then goes to the "the rich can afford it". Affordability is subjective. If someone believes you can afford to pay more tax - then do they have the right to take that money from you? I am not a strong advocate of this view

socialist's fairness means poor gets $1, rich can get $2. communist's is poor gets $1 then rich also gets $1. these are simple numeric fairness.

what i said was fairness in common sense, who contribute more who gets more.

unfair means people used government policies to gain unfair advantages in competitions.

i don't even need to talk about those banks, monopoly market dominaters. just look at those unions, professional association. they do the same.

all kinds of not necessary licenses granted by government limited people moving from one industrial sector to another. in each small sector, supply becomes too short. then government pays higher price to buy those services.

another issue is, once you have smaller sectors with strong barriers, general market rules won't apply. because supply is always short, government needs to pay more and more to satisfy these group monopoly participants.

e.g.government pays 5% more childcare benefits, the childcare costs increases 10%. similar thing applies to doctors. so, all these welfare projects become blackholes.

Kytro wrote on Dec 2^nd, 2015 at 4:06pm:

bogarde73 wrote on Dec 2nd, 2015 at 3:41pm: I'd be interested in views on this. Some of them I could predict now. Green would almost certainly say growth is bad because it can't help impacting negatively on the biosphere. Increased prosperity for all can only come from growth. That includes the possibility for increasing the communal transfer of prosperity to disadvantaged groups. It also includes the inevitability of some people achieving ever increasing wealth. That's something you could only prevent by having an almost police state which of itself would strangle growth to a greater or less degree. Or would you put so many caveats on the ambition towards economic growth that it likely wouldn't happen at all. Discuss - 30 marks I don't think it is "good per se". I think that it can lead to a lot of good things. In terms of the reference to the environment, thinking as though it is separate to the economy is a narrow view. While economic growth can be beneficial, short term growth at the expense of a longer growth cycle can be detrimental. There is nothing inherently wrong with people continuing to gain wealth, but it is dangerous when that wealth concentrates in a smaller and smaller number of hands. It limits who gains the benefits of growth and it generates risk.

Limits is the key point: ECONOMICS ITSELF RECOGNISES LIMITS!

Karnal wrote on Dec 2^nd, 2015 at 4:16pm:

bogarde73 wrote on Dec 2nd, 2015 at 3:41pm: I'd be interested in views on this. Some of them I could predict now. Green would almost certainly say growth is bad because it can't help impacting negatively on the biosphere. Increased prosperity for all can only come from growth. That includes the possibility for increasing the communal transfer of prosperity to disadvantaged groups. It also includes the inevitability of some people achieving ever increasing wealth. That's something you could only prevent by having an almost police state which of itself would strangle growth to a greater or less degree. Or would you put so many caveats on the ambition towards economic growth that it likely wouldn't happen at all. Discuss - 30 marks Walt Rostow defined economic development as "the march of compound interest". Interest encourages people to save, which gets invested back into the economy. Interest requires economic growth, but as Rostow showed, economic growth requires savings, or surplus capital. People on substance incomes have no way of saving for their old age, and cash economies with a majority of subsistence labourers have no way of building roads, cities, investing in health and education, etc. Therefore, a level of growth is essential for economic development, but growth alone is merely economic activity. It doesn't define the quality or scope of that activity. War is a great economic stimulus, but it's hardly a social good. Under Bush W's administration, the military was largely privatized, creating a short-term stimulus after the recession of the early 2000s. The invasion of Afghanistan and Iraq were part of this plan. Today, however, the US is in debt for trillions, largely money owed to China, the world’s new centre of manufacturing. China, by comparison, has developed by pump-priming its own economy. There, the march to compound interest does not fully apply as Chinese banks offer next to no interest. China's growth has relied largely on its government bankrolling Communist Party friends. These friends have built China's new cities, the largest stimulus program in history - perhaps second only to the building of the Great Wall. Our own growth has been inextricably tied to China's, and this boom is now at an end. China’s stimulus is over. China will need to decide whether to allow competition in its financial sector and allow the march of compound interest to hit the masses. This would require huge financial reforms, including de-pegging the Yuan from the US dollar and shaping far more liberal foreign and domestic investment policies.

Crap. China's wealth has come from the one child policy and economic liberation. You are right that they still have a long way to go, but you are wrong about what has caused their growth so far. The communist party is driving the country towards capitalism from the ground up. The money has to come from somewhere. They cannot buy themselves a massive stimulus package at the same time as investing money all over the world.


Quote:

All capital comes from other people's money. People become rich due to government policies. They build their wealth through their ability to lobby and befriend governments.

People become rich a lot of ways. I think you'll find that the least corrupt countries are the richest. They still have government contracts and rich people winning them, but that is hardly the driver.

One of the most corrupt countries is China, FD. It’s the second richest country in the world. All the high-growth, emerging economies have the highest corruption levels. Pakistan will be in the G20 by 2025.India will be the third largest economy by 2030. The Philippines. Russia. Indonesia. South Africa. The Middle East? Don’t even go there. Even the Australian government pays bribes to do business there. 

You can’t get a government job in most of these places without a bribe normally priced at over half a year’s salary. You can’t get a government contract without baksheesh. Simple things like licenses, government services, getting a case up in court or even reporting a crime - all these things cost in all these places. If you’re poor, forget about it.

This is the way 80% of the world works, FD. It’s not an aberration, it’s the way things are.

Ever get the feeling you’ve been cheated?

Quote:

One of the most corrupt countries is China, FD. It’s the second richest country in the world.

Not on a per capita basis. You might as well compare it to the EU as well.


Quote:

All the high-growth, emerging economies have the highest corruption levels.

You can make the observations Karnal, but you have the explanation backwards. They are "still emerging" because they are "still corrupt". The corruption is not the cause of their emergence. It is what is holding them back. You correctly identify a reduction in corruption and government interference as necessary for China to maintain it's growth. But you fail to recognise the significant improvements that have already happened and the role they have played in the growth that has happened so far. To you, less corruption is the cause of future growth, but all past growth is caused by corruption. If you honestly believed the crap you spun, you would be a communist.

freediver wrote on Dec 6^th, 2015 at 9:07am:

Karnal wrote on Dec 2nd, 2015 at 4:16pm: bogarde73 wrote on Dec 2nd, 2015 at 3:41pm: I'd be interested in views on this. Some of them I could predict now. Green would almost certainly say growth is bad because it can't help impacting negatively on the biosphere. Increased prosperity for all can only come from growth. That includes the possibility for increasing the communal transfer of prosperity to disadvantaged groups. It also includes the inevitability of some people achieving ever increasing wealth. That's something you could only prevent by having an almost police state which of itself would strangle growth to a greater or less degree. Or would you put so many caveats on the ambition towards economic growth that it likely wouldn't happen at all. Discuss - 30 marks Walt Rostow defined economic development as "the march of compound interest". Interest encourages people to save, which gets invested back into the economy. Interest requires economic growth, but as Rostow showed, economic growth requires savings, or surplus capital. People on substance incomes have no way of saving for their old age, and cash economies with a majority of subsistence labourers have no way of building roads, cities, investing in health and education, etc. Therefore, a level of growth is essential for economic development, but growth alone is merely economic activity. It doesn't define the quality or scope of that activity. War is a great economic stimulus, but it's hardly a social good. Under Bush W's administration, the military was largely privatized, creating a short-term stimulus after the recession of the early 2000s. The invasion of Afghanistan and Iraq were part of this plan. Today, however, the US is in debt for trillions, largely money owed to China, the world’s new centre of manufacturing. China, by comparison, has developed by pump-priming its own economy. There, the march to compound interest does not fully apply as Chinese banks offer next to no interest. China's growth has relied largely on its government bankrolling Communist Party friends. These friends have built China's new cities, the largest stimulus program in history - perhaps second only to the building of the Great Wall. Our own growth has been inextricably tied to China's, and this boom is now at an end. China’s stimulus is over. China will need to decide whether to allow competition in its financial sector and allow the march of compound interest to hit the masses. This would require huge financial reforms, including de-pegging the Yuan from the US dollar and shaping far more liberal foreign and domestic investment policies. Crap. China's wealth has come from the one child policy and economic liberation. You are right that they still have a long way to go, but you are wrong about what has caused their growth so far. The communist party is driving the country towards capitalism from the ground up. The money has to come from somewhere. They cannot buy themselves a massive stimulus package at the same time as investing money all over the world. Quote: All capital comes from other people's money. People become rich due to government policies. They build their wealth through their ability to lobby and befriend governments. People become rich a lot of ways. I think you'll find that the least corrupt countries are the richest. They still have government contracts and rich people winning them, but that is hardly the driver.

Really FD, how do you figure that?

The one child policy was necessary for sustainability. They were literally starving and eating grubs a few decades ago. It played a similar role to the great plagues that swept Europe in the middle ages - these caused economic booms.

Liberating the economy means capitalism - or at least, moving in that direction. That is what China is doing. It is not the resurgence of a communist superpower. It is the emergence of a new capitalist one. They are choosing the British rather than the French path to liberation.

Karnal would have us believe that all the economic booms in the past were trickery - the white man stealing money from the black man, the Chinese government spending money it doesn't have - and that economic liberation is only a factor - an absolutely necessary one of course - in future economic growth.

freediver wrote on Dec 6^th, 2015 at 5:01pm:

Quote: One of the most corrupt countries is China, FD. It’s the second richest country in the world. Not on a per capita basis. You might as well compare it to the EU as well. [quote]All the high-growth, emerging economies have the highest corruption levels.

You can make the observations Karnal, but you have the explanation backwards. They are "still emerging" because they are "still corrupt". The corruption is not the cause of their emergence. It is what is holding them back. You correctly identify a reduction in corruption and government interference as necessary for China to maintain it's growth. But you fail to recognise the significant improvements that have already happened and the role they have played in the growth that has happened so far. To you, less corruption is the cause of future growth, but all past growth is caused by corruption. If you honestly believed the crap you spun, you would be a communist.[/quote]

All countries industrialize and develop through government protectionism, croneyism and corruption. The same applies to Britain during the industrial revolution, the US during the age of the robber barrons, the Prussian industrialists of Bismark’s Germany, the military clans of Meiji Japan, and yes, the corrupt one party state that was the Soviet Union (that was also the fastest state of its size to industrialize - ever).

This is how states mobilize production. It’s a process of divvying up the spoils, quiet deals being done by governments, bankers and those who can get things done - corruptly.

But it’s not what works in the long run. Actually, I could be wrong - it hasn’t worked in the long run yet. A leader like Putin or Hu Jintao might get the balance right, but it will require a lot of popular supression to make this work.

China and Russia are both recently developed emerging economies still functioning under the croney capitalist model. The neoliberal, CNN view of the world would have you think it won’t be long before Freeeeedom sets in and these countries live happily ever after, just like us.

But don’t believe it. They said the same for post-Soviet Russia, post-invasion Iraq, and they even held out hope for the Arab Spring.

Forget this thesis, FD. History is by no means over.

Quote:

All countries industrialize and develop through government protectionism, croneyism and corruption.

All countries industrialise by escaping this. You see what they come from - dictatorship in one form or another - and see that as the cause of the new wealth. Again, you see the same things, but get the causation backwards. Just because they do not transition from dictatorship to liberal democracy overnight does not mean that dictatorship is the cause of all the change. A nation transitions a little bit from dictatorship to liberalism, and it reaps a little bit of the benefit. This is exactly what happened in Great Britain. It was the weakness of the crown that liberated the economy. France went down a different path, but to the same outcome. Neither country orchestrated industrialisation. They let it happen. Russia attempted to orchestrate it, which is why it is in the position it is now.


Quote:

This is how states mobilize production. It’s a process of divvying up the spoils, quiet deals being done by governments, bankers and those who can get things done - corruptly.

You are a communist, aren't you?


Quote:

China and Russia are both recently developed emerging economies still functioning under the croney capitalist model. The neoliberal, CNN view of the world would have you think it won’t be long before Freeeeedom sets in and these countries live happily ever after, just like us.

I believe this will happen soon, particularly in China. It is already happening. Compare where they are now with where they were a generation or two back. They are not just richer. They are freer. The government did not tell them to start making money. They allowed them to. That is all it takes.


Quote:

Forget this thesis, FD. History is by no means over.

When have I ever argued it was?

That’s right, FD. Governments "allowed" industrialization to occur because their members were industrialists. In the UK, when laws were changed to allow those with money to stand for parliament (rather than wealthy landowners), we got the industrial revolution.

Those without money, land or title were not allowed a seat in the British House of Commons until the late 19th century.  This, of course, is when the labour parties were formed. With labour parties elected (first in Australia), parliaments represented workers for the first time. Lenin had a different view, but with the formation of the labour parties, workers were discussed in parliament for the first time.

None of these things "just happen". Governments instinctively oppose change because its role is to ensure continuity. Industrialization has only ever occurred by government decree, whether free trade or command policies are used. As Deng Xiou Ping famously said, it doesn't matter what colour cat catches the mouse.

In China, Shenzen was set up as a free trade zone in the 1990s. It wasn’t until this city succeeded that the model was rolled out by varying degrees accross China. As you know, the previous "Great Leap" policies had been a disaster, unlike the command policies of the Soviet Union, which were successful.

I hate communism, just as I hate Fascism. But these two political models have had amazing success at mobilizing populations and achieving rapid economic development. I just doubt you can control populations for long. The Soviet Union fell because people made it fall. The same applied to Franco’s Spain and the Juanta-led Greece. After the command policies grew stale and failed to deliver the goods, people rose up. But when these policies work, people consent. It helps, of course, to have a network of gulags to back it up. 

Nothing "just happens", FD, but in a sense, you’re right. The conditions to allow them happen do appear as "just happening".

When you look closer, you always see human action and decision. Free trade and production has never just happened. In every industrial surge around the world, policies have made it happen. How else could a country lay down roads and power grids and create tax incentives for foreign investment (or tariffs to keep foreign goods out)?

How would this be possible without monopolies? In the US, the railways developed privately, but they were given land, and in many cases, finance, to do so. In the 20th century, the automobile and petrol companies joined forces to buy up those tracks to build highways. Again, they were given consent and government money to do so. From the outside, it looks like a change in technology, but on the inside, it's a shift in policy from public transport to car use. It's a shift driven by government deals, lobbying and political donations. The car industry in the US is propped up by the government, just as the railways once were too.

Is there any difference between a private investment model where monopolies are granted through government favour, and a publicly-owned government monopoly?

For Milton Friedman, there isn't. For Lenin, there is. But in the end, does it really matter which colour cat catches the mouse?

Karnal wrote on Dec 3^rd, 2015 at 4:04pm:

Maqqa wrote on Dec 3rd, 2015 at 3:39pm: Rich people are rich for a variety of reasons - you don't have to agree with how they got their money but why should they share more of their wealth with you? The majority of the rich are rich due to market monopolies. "Their" wealth? The richest companies are banks and super and hedge funds. Warren Buffett's wealth all comes from other people's money. All capital comes from other people's money. People become rich due to government policies. They build their wealth through their ability to lobby and befriend governments. The world's richest are those granted monopolies by governments. Most of them are lent government money to do so. Russian oligarchs, Chinese princelings, Saudi oil shieks - the wealthiest of these were lent money by their governments and granted monopolies. Many were given money by government-friendly banks - again, other people's money. The same principle applies to airlines, casino developers, radio and TV stations, and on and on. If you think people become rich through hard work or smart ideas, good luck to you. The hardest and smartest workers throughout the world will never become rich through working and thinking. The rich, however, become wealthy through good fortune and key friendships. And they all do so using the money of other people. This is precisely why they have a duty to share "their" money with us. That airline route, that mining lease, that casino or TV license or development approval - that belongs to all of us.

Bill gates started in a garage
Steve Jobs likewise
Richard Branson owned a record shop
Mark Zuckerberg was a pimpley faced nerd
Oprah had an abortion at 14 due to sexual abuse .


the next century belongs to those who have an idea.
the century for the creators.

;)

aquascoot wrote on Dec 7^th, 2015 at 9:28am:

Bill gates started in a garage Steve Jobs likewise Richard Branson owned a record shop Mark Zuckerberg was a pimpley faced nerd Oprah had an abortion at 14 due to sexual abuse . the next century belongs to those who have an idea. the century for the creators. ;)

Those guys are not the norm, Aquascoot. The clove monopoly in Indonesia is not owned by a self-made man, he was granted this monopoly by his father, a former dictator. The same applies to essential goods and services throughout most of the world.

But understand that what these innovators do to succeed in a market is ultimately the same as Thommy Suharto's clove monopoly. Bill Gates found an idea for operating PCs and monopolized it.  Bill Gates initially beat Steve Jobs to market share by selling the software, not the hardware. PCs with Gates' software prevailed over Apple, with the software Gates copied. It was a business model that gave Gates a monopoly over the software used by an entire generation, until Google and others started to compete.

These companies use innovation to gain market monopolies. Sure, this is highly preferential to a government telling a developer what to do with a product, but a look at the inside story of technological innovation shows that the market does not fully drive the process. Computer networks require a monopoly. No one wants to be on a social network hardly anyone uses. No one wants to use a word program no one else can read. The beauty of Windows and Facebook is that everyone uses it. Like an electricity grid, we only need one wire to bring us power. With most technological innovation, one or two players ultimately rise to prevail. This applied to Edison and Westinghouse in their time just as it applies to Gates and Jobs today.

I'm not really sure what Richard Branson has done to change humanity. Sure, he's made a lot of money, but again, airline routes are monopolies granted by governments. If anything, Branson's greatness lies in challenging British Airways and Qantas to the routes he was ultimately allowed to compete on. But he then became the monopolizer, seeking to protect his company from competition from the low-cost carriers. This process repeats itself, continually.

Again, whether monopolies are formed by government decree or whomever rises to the top of the heap, it matters little. I've seen the benefits of competition in aviation policy. I used to fly to Asia with Qantas, paying a small fortune. Today, I go with Air Asia and pay half the price in 1990s dollars. I'm a big fan of competition when it works. 

Competition is important, but it's not just competition that creates better and cheaper products. I hate to use corporate jargon, but synergy is crucial. Synergy allows different parts of a company to fund other parts. Synergy between companies allows networks and connectivity. "Integration" as the jargon goes.

Business is no longer pretending that competition drives them. They now acknowledge that synergy and vertical and horizontal integration is key to success. You know, like the car and petrol companies buying up railroad tracks in the 1950s to build highways: vertical integration.

This is the way business has always been done, it's just not captured in classical economic theories, which were written in an era of free trade versus protectionism. This changed when the cold war started and the choice was Amerikan trade versus communism, but the very elements of "free trade" are the question here.

FD's comments on communism are an interesting throwback to the cold war. Then , it was believed that if you questioned free trade, you were advocating communism. Today, of course, hardly anyone advocates communism. Free trade won the cold war.

Communism is not an alternative many want, but Soviet economics was never communism, merely state capitalism. We live in a dynasty of capitalism, with varying models. We cannot not live in capitalism - it's the way the human world has been structured since the Dutch East Indies Company sold the first company shares.

But we need to make capitalism work for us, not Bill Gates, not Richard Branson and not Thommy Suharto.

freediver wrote on Dec 6^th, 2015 at 5:15pm:

The one child policy was necessary for sustainability. They were literally starving and eating grubs a few decades ago. It played a similar role to the great plagues that swept Europe in the middle ages - these caused economic booms. Liberating the economy means capitalism - or at least, moving in that direction. That is what China is doing. It is not the resurgence of a communist superpower. It is the emergence of a new capitalist one. They are choosing the British rather than the French path to liberation. Karnal would have us believe that all the economic booms in the past were trickery - the white man stealing money from the black man, the Chinese government spending money it doesn't have - and that economic liberation is only a factor - an absolutely necessary one of course - in future economic growth.

Well FD, I think you may find that the Great Plagues (as such) didn't cause an Economic boom, it was the bounce back in Population Growth, after the Plaques ended, which were the cause/driver of Economic Growth!

That said, everything has limits & at the moment that means there won't be the usual Demographic Growth bounce back & therefore no Economic bounce back!

Oh & there are also a dew other factors in play, such as -
1) Energy
2) Climate Change
3) Innovation (But, we should not count on this to save us, at the last minute!)

Karnal wrote on Dec 7^th, 2015 at 11:18am:

aquascoot wrote on Dec 7th, 2015 at 9:28am: Bill gates started in a garage Steve Jobs likewise Richard Branson owned a record shop Mark Zuckerberg was a pimpley faced nerd Oprah had an abortion at 14 due to sexual abuse . the next century belongs to those who have an idea. the century for the creators. ;) Those guys are not the norm, Aquascoot. The clove monopoly in Indonesia is not owned by a self-made man, he was granted this monopoly by his father, a former dictator. The same applies to essential goods and services throughout most of the world. But understand that what these innovators do to succeed in a market is ultimately the same as Thommy Suharto's clove monopoly. Bill Gates found an idea for operating PCs and monopolized it.  Bill Gates initially beat Steve Jobs to market share by selling the software, not the hardware. PCs with Gates' software prevailed over Apple, with the software Gates copied. It was a business model that gave Gates a monopoly over the software used by an entire generation, until Google and others started to compete. These companies use innovation to gain market monopolies. Sure, this is highly preferential to a government telling a developer what to do with a product, but a look at the inside story of technological innovation shows that the market does not fully drive the process. Computer networks require a monopoly. No one wants to be on a social network hardly anyone uses. No one wants to use a word program no one else can read. The beauty of Windows and Facebook is that everyone uses it. Like an electricity grid, we only need one wire to bring us power. With most technological innovation, one or two players ultimately rise to prevail. This applied to Edison and Westinghouse in their time just as it applies to Gates and Jobs today. I'm not really sure what Richard Branson has done to change humanity. Sure, he's made a lot of money, but again, airline routes are monopolies granted by governments. If anything, Branson's greatness lies in challenging British Airways and Qantas to the routes he was ultimately allowed to compete on. But he then became the monopolizer, seeking to protect his company from competition from the low-cost carriers. This process repeats itself, continually. Again, whether monopolies are formed by government decree or whomever rises to the top of the heap, it matters little. I've seen the benefits of competition in aviation policy. I used to fly to Asia with Qantas, paying a small fortune. Today, I go with Air Asia and pay half the price in 1990s dollars. I'm a big fan of competition when it works.  Competition is important, but it's not just competition that creates better and cheaper products. I hate to use corporate jargon, but synergy is crucial. Synergy allows different parts of a company to fund other parts. Synergy between companies allows networks and connectivity. "Integration" as the jargon goes. Business is no longer pretending that competition drives them. They now acknowledge that synergy and vertical and horizontal integration is key to success. You know, like the car and petrol companies buying up railroad tracks in the 1950s to build highways: vertical integration. This is the way business has always been done, it's just not captured in classical economic theories, which were written in an era of free trade versus protectionism. This changed when the cold war started and the choice was Amerikan trade versus communism, but the very elements of "free trade" are the question here. FD's comments on communism are an interesting throwback to the cold war. Then , it was believed that if you questioned free trade, you were advocating communism. Today, of course, hardly anyone advocates communism. Free trade won the cold war. Communism is not an alternative many want, but Soviet economics was never communism, merely state capitalism. We live in a dynasty of capitalism, with varying models. We cannot not live in capitalism - it's the way the human world has been structured since the Dutch East Indies Company sold the first company shares. But we need to make capitalism work for us, not Bill Gates, not Richard Branson and not Thommy Suharto.

Nice.  :)

Karnal wrote on Dec 7^th, 2015 at 8:32am:

That’s right, FD. Governments "allowed" industrialization to occur because their members were industrialists. In the UK, when laws were changed to allow those with money to stand for parliament (rather than wealthy landowners), we got the industrial revolution. Those without money, land or title were not allowed a seat in the British House of Commons until the late 19th century.  This, of course, is when the labour parties were formed. With labour parties elected (first in Australia), parliaments represented workers for the first time. Lenin had a different view, but with the formation of the labour parties, workers were discussed in parliament for the first time. None of these things "just happen". Governments instinctively oppose change because its role is to ensure continuity. Industrialization has only ever occurred by government decree, whether free trade or command policies are used. As Deng Xiou Ping famously said, it doesn't matter what colour cat catches the mouse. In China, Shenzen was set up as a free trade zone in the 1990s. It wasn’t until this city succeeded that the model was rolled out by varying degrees accross China. As you know, the previous "Great Leap" policies had been a disaster, unlike the command policies of the Soviet Union, which were successful. I hate communism, just as I hate Fascism. But these two political models have had amazing success at mobilizing populations and achieving rapid economic development. I just doubt you can control populations for long. The Soviet Union fell because people made it fall. The same applied to Franco’s Spain and the Juanta-led Greece. After the command policies grew stale and failed to deliver the goods, people rose up. But when these policies work, people consent. It helps, of course, to have a network of gulags to back it up.  Nothing "just happens", FD, but in a sense, you’re right. The conditions to allow them happen do appear as "just happening". When you look closer, you always see human action and decision. Free trade and production has never just happened. In every industrial surge around the world, policies have made it happen. How else could a country lay down roads and power grids and create tax incentives for foreign investment (or tariffs to keep foreign goods out)? How would this be possible without monopolies? In the US, the railways developed privately, but they were given land, and in many cases, finance, to do so. In the 20th century, the automobile and petrol companies joined forces to buy up those tracks to build highways. Again, they were given consent and government money to do so. From the outside, it looks like a change in technology, but on the inside, it's a shift in policy from public transport to car use. It's a shift driven by government deals, lobbying and political donations. The car industry in the US is propped up by the government, just as the railways once were too. Is there any difference between a private investment model where monopolies are granted through government favour, and a publicly-owned government monopoly? For Milton Friedman, there isn't. For Lenin, there is. But in the end, does it really matter which colour cat catches the mouse?

;D and a sense of humour: please stop,.. no wait- continue at your leisure  ;) ;)

bogarde73 wrote on Dec 3^rd, 2015 at 9:55am:

Where you say slavery Karnal, I say comparative advantage, which is a flexible relationship that will evolve in ways we haven't imagined yet. And I agree with Macca's point: ask the people of Bangladesh, are they happy with the work that's come their way at this point or would they still prefer a more subsistence existence in the paddy fields, subject to the whims of typhoons and so forth. Resources are finite in the sense that no more rocks are being manufactured, although even that's debatable. But what I mean is we don't know what elements or compounds still remain to be understood in terms of their full utility. And as I think beer mentioned, an infinite and as yet not understood resource is human cooperation. You could add to that imagination and the expansion of the mind. There is no limit to growth until the sun does its thing and maybe even not then.

jebus: go hug a friggin' tree already... do they have trees on planet accountant?

imagine endless growth: it doesn't even make sense on paper ;D ;D ;D ;D ;D ;D ;D ;D

Karnal wrote on Dec 7^th, 2015 at 8:32am:

That’s right, FD. Governments "allowed" industrialization to occur because their members were industrialists. In the UK, when laws were changed to allow those with money to stand for parliament (rather than wealthy landowners), we got the industrial revolution. Those without money, land or title were not allowed a seat in the British House of Commons until the late 19th century.  This, of course, is when the labour parties were formed. With labour parties elected (first in Australia), parliaments represented workers for the first time. Lenin had a different view, but with the formation of the labour parties, workers were discussed in parliament for the first time.

In other words, at every step of the way, our economy grew because people were more free, not less free to participate in it, and it was getting fairer.

You see the past as less free than the present and the future as more free. This may be true, but you mistake this for the cause of economic growth. To you, cronyism is the cause of all past economic growth and economic liberalism is the cause of all future economic growth, and time runs in both directions from the present. Which makes causation difficult for you to establish for past events. Or maybe you are just a communist.


Quote:

None of these things "just happen". Governments instinctively oppose change because its role is to ensure continuity.

Are you making this up as you go along?


Quote:

I hate communism, just as I hate Fascism. But these two political models have had amazing success at mobilizing populations and achieving rapid economic development. I just doubt you can control populations for long. The Soviet Union fell because people made it fall.

Wrong. It "fell" because the goal posts shifted. What you see as a success in the past would be a dismal failure by today's standards.


Quote:

After the command policies grew stale and failed to deliver the goods, people rose up.

So tell me about the anti-communist Russian revolution? How about the Chinese one? Was there a revolution in Britain like in France that sparked the UK's industrialisation?


Quote:

How would this be possible without monopolies?

Quite easily. The government just needs to stop getting in people's way. Again, you are getting the causation for past events backwards. You associate them with monopolies, therefor you think monopolies are the cause. They stood in the way of economic development. Often less so than what came previously, but that does not mean they were necessary. There are economic justifications or explanations for monopolies, but you are miles off, and they have nothing to do with cronyism.


Quote:

Computer networks require a monopoly.

Crap. Again, you mistake correlation with causation. You can not explain the monopoly because you do not understand the economics behind it. You can not imagine it any other way. So you insist there is no other way.


Quote:

Competition is important, but it's not just competition that creates better and cheaper products. I hate to use corporate jargon, but synergy is crucial. Synergy allows different parts of a company to fund other parts. Synergy between companies allows networks and connectivity. "Integration" as the jargon goes.

So it is synergy that drives economic growth, not competition?


Quote:

Business is no longer pretending that competition drives them. They now acknowledge that synergy and vertical and horizontal integration is key to success.

Either that, or the exact opposite, depending on the business model they choose.


Quote:

This is the way business has always been done, it's just not captured in classical economic theories

Right. Only Karnalism captures the reality of economics. It's synergy, innit?


Quote:

FD's comments on communism are an interesting throwback to the cold war. Then , it was believed that if you questioned free trade, you were advocating communism.

So what are you advocating Karnal? Synergy? Empty headed catchphrases from self improvement books? An accounting degree?

Quote:

Well FD, I think you may find that the Great Plagues (as such) didn't cause an Economic boom, it was the bounce back in Population Growth, after the Plaques ended, which were the cause/driver of Economic Growth!

Wrong again. As populations returned to 'stable' (ie Malthusian) levels, people once again lived in Misery. Except of course for those rare occasions where it didn't.


Quote:

That said, everything has limits

Medieval European populations were on that limit Perce. As was China's, very recently.

freediver wrote on Dec 8^th, 2015 at 8:20am:

Quote: Well FD, I think you may find that the Great Plagues (as such) didn't cause an Economic boom, it was the bounce back in Population Growth, after the Plaques ended, which were the cause/driver of Economic Growth! Wrong again. As populations returned to 'stable' (ie Malthusian) levels, people once again lived in Misery. Except of course for those rare occasions where it didn't. [quote]That said, everything has limits

Medieval European populations were on that limit Perce. As was China's, very recently. [/quote]

Really?
How?

They were on the brink of starvation, living the Malthusian dilemma. That's why a sudden cut to the population was an instant economic boom. They went from having no spare resources to having some. That's an infinite increase in disposable income.

https://en.wikipedia.org/wiki/Great_Famine_of_1315%E2%80%9317

Famines were a familiar occurrence in Medieval Europe.

If you are confused about the lower absolute population, see this explanation:

http://www.ozpolitic.com/population-sustainability.html#IPAT

freediver wrote on Dec 9^th, 2015 at 5:32pm:

They were on the brink of starvation, living the Malthusian dilemma. That's why a sudden cut to the population was an instant economic boom. They went from having no spare resources to having some. That's an infinite increase in disposable income. https://en.wikipedia.org/wiki/Great_Famine_of_1315%E2%80%9317 Famines were a familiar occurrence in Medieval Europe. If you are confused about the lower absolute population, see this explanation: http://www.ozpolitic.com/population-sustainability.html#IPAT

Are you living in stone age? or bronze age? There is not such a resource limitation problem need to cut population. Since industrial revolution, the only problem is obesity and pollution.

Population growth provides purchasing power, that is the most important economy lubricant.

One child policy in China didn't save any resources, did you see any types of raw material consumption got shrunk in past decades?

Quote:

Are you living in stone age? or bronze age? There is not such a resource limitation problem need to cut population.

I did not claim there was.


Quote:

One child policy in China didn't save any resources

I did not claim it did. It did not even reduce the population.

Read it again.

About the corruption, there are 2 types:
1. Help to make a new cake, get bigger share from the new cake this political leader not deserved to get.
This is the model in China. This is not very different to high earning CEO in a public company, if you put moral consideration away.
2. Not damage the existing cake if they are bribed. This was the communist Russia and current North Korea model.

freediver wrote on Dec 9^th, 2015 at 5:32pm:

They were on the brink of starvation, living the Malthusian dilemma. That's why a sudden cut to the population was an instant economic boom. They went from having no spare resources to having some. That's an infinite increase in disposable income. https://en.wikipedia.org/wiki/Great_Famine_of_1315%E2%80%9317 Famines were a familiar occurrence in Medieval Europe. If you are confused about the lower absolute population, see this explanation: http://www.ozpolitic.com/population-sustainability.html#IPAT

FD,
The first couple of sentences, of your reference -
https://en.wikipedia.org/wiki/Great_Famine_of_1315%E2%80%9317
are as follows -

The Great Famine of 1315–1317 (occasionally dated 1315–1322) was the first of a series of large-scale crises that struck Europe early in the fourteenth century. Most of continental Europe (extending east to Russia and south to Italy) and Great Britain were affected.[1] The famine caused millions of deaths over an extended number of years and marked a clear end to the period of growth and prosperity from the eleventh to thirteenth centuries.
===========================================
As I said previously, these sort of situations caused the Economy to collapse, it was the population recovery that caused the boom.

That said, it is now correct that we have reached "THE Malthusian situation", where the Global Population level is too high, to be sustainable by Energy needs & Food/Water needs, so Economics is now being driven in different directions, for different reasons, than have applicable for a long, long time, possibly forever.
THIS TIME IS DIFFERENT!

So people actually starving because there is not enough food to go round is not a Malthusian dilemma, but obesity overtaking cancer as the biggest killer is?

We were actually talking about plagues, not famines.

The population recovery did not cause the boom. It came after the boom, and caused the next famine/plague. The economic booms came immediately after the plagues. It is simply not possible that a population increase caused it.

freediver wrote on Dec 9^th, 2015 at 7:46pm:

So people actually starving because there is not enough food to go round is not a Malthusian dilemma, but obesity overtaking cancer as the biggest killer is? We were actually talking about plagues, not famines. The population recovery did not cause the boom. It came after the boom, and caused the next famine/plague. The economic booms came immediately after the plagues. It is simply not possible that a population increase caused it.

It was your reference, which you introduced!

You said, "That's why a sudden cut to the population was an instant economic boom."

Your own reference said "  The famine caused millions of deaths over an extended number of years and marked a clear end to the period of growth and prosperity from the eleventh to thirteenth centuries."

FD, would you mind explaining the "Malthusian" argument that China’s population growth of 148% since 1950 has been a sudden cut to the population that produced an instant economic boom?

As ever, I’m curious.

I think my left handed brain is seeing this different from all of you.

I have my own definitions , therefore as long as the economic growth is not based on unconscionable industries it will always be good.

I am not linking economic growth to resource depletion or population growth tho.

More economic growth therefore more wealth means we can afford to pay for greener technologies and a cleaner planet.

As for population growth,, Australia should be held up as a model for the world to copy.
Our economy is basically sound , yet without immigration (citation req) our population would be static.
If every country did that we would be laughing.

Sooner or later we have to uncouple population growth from economic growth

Quote:

Your own reference said "  The famine caused millions of deaths over an extended number of years and marked a clear end to the period of growth and prosperity from the eleventh to thirteenth centuries."

A plague comes and goes. People return to health. It is a sudden reduction. A famine takes years to unfold. When the drought ends, people are still starving. A deadly plague will kill off plenty, then the survivors return to full health. The crops are still alive, and there is more to go around. Instant boom.

I have no doubt that famines had a similar effect, once people returned to health, just not so pronounced. For example, when the famine ends, people are no longer starving. This is an improvement. On top of that, the reduction in population means they are less likely to be starving again in the near future. They have more of everything. Most people would consider this to be better off. Richer, even.


Quote:

FD, would you mind explaining the "Malthusian" argument that China’s population growth of 148% since 1950 has been a sudden cut to the population that produced an instant economic boom? As ever, I’m curious.

They went from an unsustainable population to a sustainable one. See the IPAT link I provided earlier for Perce if you are getting hung up on the increase in absolute population. Obviously the economic liberalisation played a big part too.


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Sooner or later we have to uncouple population growth from economic growth

How is it coupled?

How is it coupled?


OK point taken , perhaps its not.

Then I would say we just have to stop population growth and keep economic growth

freediver wrote on Dec 9^th, 2015 at 8:43pm:

Quote: Your own reference said "  The famine caused millions of deaths over an extended number of years and marked a clear end to the period of growth and prosperity from the eleventh to thirteenth centuries." A plague comes and goes. People return to health. It is a sudden reduction. A famine takes years to unfold. When the drought ends, people are still starving. A deadly plague will kill off plenty, then the survivors return to full health. The crops are still alive, and there is more to go around. Instant boom. I have no doubt that famines had a similar effect, once people returned to health, just not so pronounced. For example, when the famine ends, people are no longer starving. This is an improvement. On top of that, the reduction in population means they are less likely to be starving again in the near future. They have more of everything. Most people would consider this to be better off. Richer, even. [quote]FD, would you mind explaining the "Malthusian" argument that China’s population growth of 148% since 1950 has been a sudden cut to the population that produced an instant economic boom? As ever, I’m curious.

They went from an unsustainable population to a sustainable one. See the IPAT link I provided earlier for Perce if you are getting hung up on the increase in absolute population. Obviously the economic liberalisation played a big part too. [/quote]

I already checked your link, FD. It doesn’t mention anything on this subject - that’s why I’m.asking.

How did China’s population growth from half a billion people to one and a quarter billion people in 50 years make its population more sustainable? This fact appears to disproves your entire thesis. Is there something I’ve missed? What is it?

If you can explain this, we can assess your claim properly.

What do you mean it "doesn't mention it"? This is what the entirety of the section on the IPAT equation is about. That is why I posted the link in anticipation of this question.

freediver wrote on Dec 10^th, 2015 at 6:04am:

What do you mean it "doesn't mention it"? This is what the entirety of the section on the IPAT equation is about. That is why I posted the link in anticipation of this question.

FD, you know why a source that doesn’t describe China’s population growth as a population cut is not going to work. I’m inviting you to address your claims seriously. At present, no one here believes them. They appear to make no sense, particularly in light of the feedback you've received.

I’ve always been eager to discuss economic issues with you. This is a subject you’ve put a lot of  thought into. I’m concerned, however, that you bound yourself to a few impressive universal theories back in uni and have since given up thinking about them.

So far, your "Malthusian" argument doesn’t stand up to question. As others have shown, population growth normally gives way to a rise in economic growth, not the reverse. The China example backs this up. Your own sources back this up.

Tricking readers to "win" an argument doesn't work. If you want to persuade, you'll need to provide facts. You're free to provide these, just as you're free to treat your readers like mugs by posting contradictory, unrelated sources.

It's up to you. Freeeedom, innit.

You haven't even followed the link yet, have you Karnal? I think you'll find that no-one who has is still asking for an explanation. In fact, you are the only one asking for it. I posted the link in anticipation.

freediver wrote on Dec 10^th, 2015 at 6:02pm:

You haven't even followed the link yet, have you Karnal? I think you'll find that no-one who has is still asking for an explanation. In fact, you are the only one asking for it. I posted the link in anticipation.

No worries, FD. You can’t say we didn’t try.

I can say with certainty that you didn't bother checking out the link. As far as you are concerned, if you are not already aware of it, it does not exist and there is no point looking or trying to inform yourself. You even use your ignorance as an arguing point and project it on to other people. You are a textbook example of willfully ignorant.

freediver wrote on Dec 8^th, 2015 at 7:54am:

So it is synergy that drives economic growth, not competition? Quote: Business is no longer pretending that competition drives them. They now acknowledge that synergy and vertical and horizontal integration is key to success. Either that, or the exact opposite, depending on the business model they choose. [quote]This is the way business has always been done, it's just not captured in classical economic theories

Right. Only Karnalism captures the reality of economics. It's synergy, innit?


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FD's comments on communism are an interesting throwback to the cold war. Then , it was believed that if you questioned free trade, you were advocating communism.

So what are you advocating Karnal? Synergy? Empty headed catchphrases from self improvement books? An accounting degree?[/quote]

Karnal I have started another thread on this for you:

http://www.ozpolitic.com/forum/YaBB.pl?num=1450997927

freediver wrote on Dec 12^th, 2015 at 8:31am:

I can say with certainty that you didn't bother checking out the link. As far as you are concerned, if you are not already aware of it, it does not exist and there is no point looking or trying to inform yourself. You even use your ignorance as an arguing point and project it on to other people. You are a textbook example of willfully ignorant.

Not willfully ignorant, FD. If you won’t quote or refer me to your source, what to do?

Ignorance is strength, no?

Are you saying you need me to post the link again? Try going back in the thread to before you started pretending you had read it.

How long would any reasonable person try to hide their sources, FD?  Weeks? Months?

Sorry. That’s a question.

And there I was thinking per capita was the most meaningless statistic in Economics.

this takes the cake.....!!!!

http://i65.tinypic.com/2cr3qmo.jpg

Wow, how did you find that hidden source Ajax? You followed the link I posted didn't you?

freediver wrote on Dec 27^th, 2015 at 3:47pm:

Wow, how did you find that hidden source Ajax? You followed the link I posted didn't you?

Ajax must have done some good detective work, FD, but I can’t read any of it.

Do you want to paste your source here for us all to see, or should we continue to forget it and move on?

I must say, after all this, it had better be good.

freediver wrote on Dec 9^th, 2015 at 5:32pm:

They were on the brink of starvation, living the Malthusian dilemma. That's why a sudden cut to the population was an instant economic boom. They went from having no spare resources to having some. That's an infinite increase in disposable income. https://en.wikipedia.org/wiki/Great_Famine_of_1315%E2%80%9317 Famines were a familiar occurrence in Medieval Europe. If you are confused about the lower absolute population, see this explanation: http://www.ozpolitic.com/population-sustainability.html#IPAT

freediver wrote on Dec 27^th, 2015 at 9:05pm:

freediver wrote on Dec 9th, 2015 at 5:32pm: They were on the brink of starvation, living the Malthusian dilemma. That's why a sudden cut to the population was an instant economic boom. They went from having no spare resources to having some. That's an infinite increase in disposable income. https://en.wikipedia.org/wiki/Great_Famine_of_1315%E2%80%9317 Famines were a familiar occurrence in Medieval Europe. If you are confused about the lower absolute population, see this explanation: http://www.ozpolitic.com/population-sustainability.html#IPAT

So we’re back to.a link that says nothing about China doubling its population but somehow achieving massive economic growth through a population drop.

Maybe you could ask me about your link again, FD.

How come you did not recognise it from the image posted by Ajax?

You still haven't even read it, have you?

freediver wrote on Dec 27^th, 2015 at 9:16pm:

How come you did not recognise it from the image posted by Ajax? You still haven;t even read it, have you?

A question if I may, FD. How come you like to spend weeks going on about a link when all you need to do.is cut and paste the relevant bits and put me to shame?

Forgive me for stating the obvious here, FD, but it looks as if you’re playing tricks.

If you don’t want to post your thoughts, no worries. If you do, I’ll wait here with baited breath for the umpteenth time until you finally wipe the grin off my dirty Pakistani face with this excellent proof of yours.

Just tell me when you’re ready, okay?

I can't be bothered figuring out how to format the equation, and the article would loose it's meaning without it. It is not a trick Karnal, unless you think there is something special in leading a horse to water and making it drink. To be honest it never occurred to me that it would be such a stumbling block for you.

freediver wrote on Dec 27^th, 2015 at 9:29pm:

I can't be bothered figuring out how to format the equation, and the article would loose it's meaning without it. It is not a trick Karnal, unless you think there is something special in leading a horse to water and making it drink. To be honest it never occurred to me that it would be such a stumbling block for you.

No need to post the equasion, FD. I’ve read all that.

I’m just looking for the bit that talks about China’s population growth. That’s just a few paragraphs, shurely.

If you can’t post it, no worries. I’ll just go back to assuming it doesn’t exist.

All growth should be based on sustainability of resources, the environment and energy sources. Unrestrained growth without regard for pollution and environmental consequences is definitely not good.

Growth that is detrimental to the environment or ecosystem is a penalization of the majority for the benefit of the minority that gain most from growth.