Geoffrey,Originally Posted by Geoffrey Collier
I agree with your analysis of the future prospects for employment in the manufacturing sector; and with your view that any attempt to impose Austrian economic principles onto what is in effect a command economy would lead to a social/economic disaster, but this still leaves us with a problem. Namely were is the money going to come from to support state created jobs?
It seems to me that the problem is not that service and state jobs don't contribute to the economy, [ although some clearly don't the thought police at the CRE for example] but that it is manufacturing which contributes far more to the economy, in terms of value added, and is therefor a major source of wealth creation. Yes, financial services and retail do contribute a lot to our economy, but how much longer can they continue to do so in the face of systemic economic failure and consumers who have a diminishing ability to consume? The boss of Unilever went on record last week stated that he foresees food price inflation of 4-5 per cent every year for the forsee-able future. We also have rising energy prices, falling house prices and all in the face of stagnant or falling wage levels. It seems to me that it is only a matter of time until we start seeing large scale redundancies in the service sector. Which will lead to less tax receipts, and more state expenditure in the form of benefit, and therefor even less money to pay for civil-servants and others on the state payroll. How do we get out of what seems to be a vicious circle? I haven't got a bloody clue! It seems to me that this can only end badly.
'But where danger is deliverance also grows.'
Geoffrey Collier
The British government is borrowing 2 billion pounds a week. The National Debt is a trillion pounds and rising. Unemployment is 2.7 million and rising fast. Are you suggesting Geoffrey Collier that there is nothing wrong with the British economy ?
I say that there is something very, very, very wrong with the British economy. David Cameron believes that we can all work in shops selling cheap imported goods from China
David Cameron believes that everything can be made cheaper in China, so it follows therefore that we should import everything from China.
Clearly David Cameron's economic policies are clearly failing. The National Debt is going up. Unemployment is going up.
Under Gordon Brown GDP went up, and up, and up. But at the end of the Labour boom we were not richer, we were virtually bankrupt. The fact that GDP went up, and up, and up, meant nothing because we were in fact getting poorer during that period.
This means the country can be getting poorer at a time that GDP is rising. This is because GDP is a very bad method of assessing growth and wealth.
SDP: I have replied to those questions on another thread. The methodology to assess economic variations are various optional and not too important.
Economic sustainability is more to the point. Why don't you answer some questions for a change? You seem to be arguing that we will be able to 'make things' which will require a large labour force; produce a profit, and will be immune from that automation and rationalisation which has been successfully applied to every other economic activity. If you disagree, name one which has escaped those processes?
If all the economists were laid end to end, they'd never reach a conclusion.
George Bernard Shaw
Little Englander
Not; Little Englander (sour) or LittleEnglander
Appian: If Socrates had been more successful, decisions would be reason unaffected by desire. Sadly, he largely failed and we have to live with the consequences. We can't look for Utopias, but merely arranging the affairs of society in a fairly equable way. That should be possible, and that should be our aim. We have a situation where many can now no longer afford to retire, and at retirement age a new occupation as an assistant in B&Q commences. At the other end of the spectrum are rich individuals, well paid and rewarded but whose talents and accomplishments are quite mediocre. Do you believe that Sir Fred Goodwin, who was forced to retire at 52 years of age, after presiding over the largest loss (£22.1 Billions) in British corporate history, should be a role model?. A knighthhod was deemed justifiable, and a pension of £700, 000, p.a. was awarded. I see, in to days paper, that anyone retiring now, having saved £100,000, into their pension fund; a pension of £5,800, p.a. (taxable) is the going rate. If we try and compare like-with-like, a top banker, with an eminent surgeon for example, or the leading members of any profession, the differences are patent. If we put aside the question of justice, is that situation sustainable?
We are told that that inequity is inevitable; 'I'm afraid' they tell us, 'that's what nature is like'. Let us give thought to that for a moment. The average intelligence is in the 90-109 I.Q., range; geniuses are in the 140-165, range. The average height is 5ft, 8'. How many people do you know who are 11,ft. 4 inches. The average life expectancy (incl. m/f.) is 78, years. How many people have you met who are 156, years old? The list is endless. You are more likely to be mentally retarded than a genius; a dwarf rather than a giant; die before reaching the average age. In nature
deviations from the 'average' are are overwhelmingly deviations which are short of the average, rather than those which exceed them. Deviation in excess of the average are confined almost exclusively to social and economic organisation.
Now let us return to economics. Britain, and indeed other nations, should become as self-sufficient as possible. Sadly, Britain does labour under several disadvantages. Time and time again Britain will forgo actual economic advantage for perceived political influence. Who, but Britain, would give away her fish-stocks to demonstrate that they are good Europeans? Agree to agricultural quotas which mean that we have to import that which we could produce ourselves? Wales has the largest anthracite deposits outside of Pennsylania; in addition Britain, collectively, has about four-hundred years of known coal reserves. The mineral potential for the use and conversion of coal is immense. Unfortunates without an idea in their heads, our politicians insist that we must be a voice in the world. In Afghanistan, Britain has more than twice the number of troops, than any other European nation. We will be in Iran very soon, believe me. If Britain were an inadequate living on any housing estate, a responsible psychiatrist would have us 'sectioned'. Most of our national problems are self-inflicted wounds.
What the average person needs are reasonable, obtainable and justifiable. A home in a clean environment, with services available, and not too worried about having to 'pay the bills' until you are ninety. Food, domestic equipment and fuel can be provided quite reasonably in a consumer society. The cost of pensions would and should be affordable. Pensions, benefits, and even civil service salaries inject considerable revenue into the economy. Inflation can be a problem; but I will guarantee you that in the immediate future, and for many years to come, inflation will be imported. The 'home grown' inflation will be very small. Many of your predictions, house prices falling, and much else, will be the consequence of a depressed economy. Historically, a producer society had problems which took several generation to solve. Similarly, a consumer society is going through a similar process. Those difficulties are endemic to all western countries, and the Asian ones will not be too far behind. I remember when the British were chided for not being enough like the Japanse. That plea has long since ceased. However, don't despair, Britain lacks much, but she has a long and strong survival instinct which has served her well over the ages.
The issue as I see it is the British obession with the global market place which means that British consumers are actually causing the economic damage themselves. They keep buying cheaper imported products instead of a British products, congratulate themselves on what bargains they have purchased and then later on, see themselves put out of a job due to their own employer being unable to compete with foreign imports. In effect, the British consumer is responsible for their own unemployment.
I am not advocating some sort of Buy British campaign because the reality is that British consumers, given a choice, will always buy cheap imports and ignore the wider national interest. I just think we need less moaning from them when they lose their own jobs and an acceptance of their own culpability.
Last edited by CB100; 29-01-2012 at 03:09 PM.
Geoffrey Collier
GDP is a very bad way of calculating growth and wealth.
If Britain suddenly had an extra million immigrants GDP would increase.
If a million people signed off the dole, and claimed Old Age Pension instead which is higher, GDP would increase.
This means that some things that make the country poorer actually increase GDP
Geoffrey Collier
GDP is a very bad way of calculating growth and wealth.
If we find the we dont need so many civil servants then this will cause GDP to shrink.
Any sort of efficiency savings made by government this will cause GDP to shrink.
If government saves money and cuts government spending this will cause GDP to shrink.
This means that some things that actually make the country richer, cause the GDP to shrink.
Geoffrey Collier
Germany has managed to run a successful manufacturing economy and pay high wages. Germany also runs a huge trade surplus every month year after year. So it is possible to pay high wages, have low unemployment and make things.
Last edited by SDP; 30-01-2012 at 12:40 PM.
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