Is economic growth necessarily the same as "real" growth?

[PhilipT]

Mentioned creating holes and then filling them in.

The original 'holes' quote is from Keynes: he was making the point that (given government policy to boost demand in a recession by borrowing and spending) if no more useful work were available then this would be better than nothing, because it would keep employed people who would then spend their wages, thereby stimulating demand, which would sustain the jobs of other workers .. He wasn't suggesting it as a practical proposition, only that it would be better than nothing.

Just my opinion, but the recent announcements in this area seem to be a mix of good and bad stimulus. The infrastructure improvements will stimulate demand in exactly the same way as digging holes, but be a far better investment; the snag is these things take ages to kick in and they should have started three years ago. The help for first-time buyers may stimulate the property market (including construction), but it'll also encourage people to take on long-term debt at a time of historically-low interest rates, and that worries me.

[Vile Consort]

Value is perfectly well-defined in economics: the value of something is what people are prepared to pay to buy one.

[Dave2002]

Value is perfectly well-defined in economics: the value of something is what people are prepared to pay to buy one.

Maybe, but I'm not convinced.

The value of a worker who spends time looking after autistic children seems to be far lower than a banker.

It seems totally wrong to me that bankers get paid very much more than some carers, and some highly skilled people who look after disabled people.

If we take a very selfish view, that we are never going to become ill ourselves, then maybe this is correct. If we have a society in which we believe collectively that the disadvantaged are worth caring for, then somehow the values need to be modified, and perhaps some other "value" related concepts need to be used.

Otherwise, why don't we just admit that we don't give a fig for people who are ill, disabled, disadvantaged, out of work etc., and carry on as usual? It's their problem not ours, after all!

[teamsaint]

Our society has pretty much admitted this anyway Dave.

So many problems are hidden away.

many worthwhile jobs are scorned by the media(and consequently many of our people).
The poor and vulnerable are just "costs".

all that matters is the rich getting richer, and squeezing more and more out of assets.

[Dave2002]

Our society has pretty much admitted this anyway Dave.

So many problems are hidden away.

many worthwhile jobs are scorned by the media(and consequently many of our people).
The poor and vulnerable are just "costs".

We are part of this society. We don't have to just sit back and agree with the way it apparently runs.

all that matters is the rich getting richer, and squeezing more and more out of assets.

All that matters to whom?
Presumably the rich and the self appointed.

[teamsaint]

We are part of this society. We don't have to just sit back and agree with the way it apparently runs.

All that matters to whom?
Presumably the rich and the self appointed.

to those with the power. I think we agree anyway.
we certainly don't have to sit back and take it....but action is not necessarily easy when the ballot box offers three different colours of a very similar product.

[PhilipT]

If we have a society in which we believe collectively that the disadvantaged are worth caring for, then somehow the values need to be modified, and perhaps some other "value" related concepts need to be used.

How disadvantaged do people have to be to be worth caring for? I'm thinking of the recent figures that showed that if you line up households in order of disposable income, then the break-even point of net taxes paid minus benefits received comes in the seventh decile. The top 30-something %, especially the top 10%, are taxed heavily to pay the benefits of the bottom 60-odd %. Is that caring for the disadvantaged, or is it soaking the rich to pamper the majority?

[teamsaint]

How disadvantaged do people have to be to be worth caring for? I'm thinking of the recent figures that showed that if you line up households in order of disposable income, then the break-even point of net taxes paid minus benefits received comes in the seventh decile. The top 30-something %, especially the top 10%, are taxed heavily to pay the benefits of the bottom 60-odd %. Is that caring for the disadvantaged, or is it soaking the rich to pamper the majority?

1. Depends if you believe the figures.
2. our society is hopelessly out of kilter.There are huge numbers of people in the bottom few centiles,who are vulnerable in lots of ways.
We need to support them , and each other, and not take the nick Robinson "look at my dodgy graph and see how much the rich already pay " approach.

The people at the top have all the weapons, including the best accountants and statisticians.

[PhilipT]

There are huge numbers of people in the bottom few centiles,who are vulnerable in lots of ways.
We need to support them ...

You mean people like this?

[teamsaint]

Yes.There is a big group of people who choose poverty.
They prefer poor education, sink estates with the attendant drug issues, lousy parenting, virtually no job opportunities other than most menial kind, and they prefer it if they are constantly bombarded with media images of glamorous successful people like x factor stars and footballers.
they actually like it that way.

You previously explained your background. the success of a few escaping a difficult start in life does not excuse a society that treats its vulnerable, (old, mentally ill, very poor people) as badly as we do.
Our society is badly divided on wealth grounds, its getting worse, and there is no justification I know of to accept it.

Oh, and I have no time for those who cheat the benefits system, and none for those who cheat the tax system.

[PhilipT]

Our society is badly divided on wealth grounds, its getting worse, and there is no justification I know of to accept it.

I'd like to know how much inequality you would accept.

We can have equality of opportunity, or equality of outcomes. If we choose equality of outcomes then there is no incentive for people to strive. This is the situation that Cuba put itself into, with doctors paid pretty much the same as cleaners, and an economy so rotten that most of the population depend on government food rations and electric toasters were banned for many years because of the amount of electricity they used.

If we choose equality of opportunity then the question remains: opportunity for what? If the answer is: opportunity to be no better off than everyone else, then we are back to the first case. If we choose opportunity to be better off than most others, then we come against my question above: how much inequality will you accept, and will it be enough to provide the necessary incentive?

I'm all in favour of the NHS, state education (but with a bit more room to sack poor teachers than there is at the moment - this, and not small class sizes, is a big reason why private schools notch up good results), pensions for all and a safety net for the unfortunate. When over 60% of households gain from the safety net and state support for one family costs several times the average pre-tax income of a graduate in full employment there is surely something wrong.

[ahinton]

I suspect that whether the answer to this question is yes or no will depend less on whether one is or os not a capitalist as much as it will on whether one is or is not an economist.

[ahinton]

Oh, and I have no time for those who cheat the benefits system, and none for those who cheat the tax system.

Nor do I in principle, but it should not be forgotten by the more moralistic among us that (a) both systems cheat themselves from time to time by reason of the way that they are constructed and (b) governments also actively encourage people to get around parts of the tax system by offering or sanctioning tax dodges of one kind or another, such as ISAs, pension contribution tax relief, inheritance tax mitigation instruments and the like as well as standing by and allowing HMRC to let large companies such as Vodafone, Goldman Sachs and the like off substantial proportions of their tax bills on occasion - so please let's not allow our principles to encourage undue sanctimoniousness over this one...

[PatrickOD]

In principle, ahinton? Does not one be true to oneself? Isn't that a principle?

[teamsaint]

I'd like to know how much inequality you would accept.

We can have equality of opportunity, or equality of outcomes. If we choose equality of outcomes then there is no incentive for people to strive. This is the situation that Cuba put itself into, with doctors paid pretty much the same as cleaners, and an economy so rotten that most of the population depend on government food rations and electric toasters were banned for many years because of the amount of electricity they used.

If we choose equality of opportunity then the question remains: opportunity for what? If the answer is: opportunity to be no better off than everyone else, then we are back to the first case. If we choose opportunity to be better off than most others, then we come against my question above: how much inequality will you accept, and will it be enough to provide the necessary incentive?

I'm all in favour of the NHS, state education (but with a bit more room to sack poor teachers than there is at the moment - this, and not small class sizes, is a big reason why private schools notch up good results), pensions for all and a safety net for the unfortunate. When over 60% of households gain from the safety net and state support for one family costs several times the average pre-tax income of a graduate in full employment there is surely something wrong.

To pick up on your point about teachers in the private sector, (and I have long direct experience of both sectors), if class size is unimportant, why don't private schools save a bit of money by having bigger class sizes. Seems odd.

Back to inequality, I don't have to like a system that is making our country increasingly unequal , and increasingly divided. I don't need an end objective really. Just some progress would be good.Make things better, not worse, more equality not less.
Equality of opportunity really is a joke. I won't bother with the statistics, but you and I both know that the vast majority of good education, jobs and opportunities go those from the right side of the tracks.