Sandwichman wrote: > You are absolutely right about the linkage between economic growth and > government revenues! There is a built-in incentive for the government to > pursue growth policies, regardless of whether they are appropriate for the > national welfare. The limiting case may well be where the growth leads to a > systemic environmental collapse that itself makes further growth > impossible...
Right. Capitalists also benefit in a big way from GDP-growth: without it, surplus-value can't be realized. Naturally enough, the capitalists and the state work together hand in glove, with the capitalists being the "hand," one that's not very invisible. > Now my obvious preference would be to take precautionary action before the > collapse occurs. The other option is to simply assume it won't happen. For > example, "there is no housing bubble," and then innocently ask, when and if > it occurs, "WHO could have foreseen this?" Well, the answer to that question > is: certainly not those who couldn't foresee the housing bubble. right. > Anyway, I am becoming convinced that sustained growth is not an option. > Expansionary fiscal policy might even take us to the brink of "robust and > sustained economic expansion" but at that point the stimulus will have to be > curtailed because of the inflationary effects of "pump-priming the boom." > That point will come long before full employment is within sight. It's good to separate the demand-side from the supply-side version of "growth." It is quite likely that the supply side type of growth _is_ unsustainable (at least when measured by potential real GDP). The long-lasting kind of demand-side growth that goes in step with that supply growth is thus also unsustainable. On the other hand, the movement toward full employment of resources (which is driven by demand-side growth) means greater efficiency of the utilization of resources. Currently, we have have an increasing number of people whose work-hours per year have been involuntarily restricted -- and are being restricted -- by falling aggregate demand. Their efforts are simply being wasted; they're not working to fix the environmental mess, for example. Further, their situation is making them less and less discriminating about where the jobs are going to come from. Sub-potential GDP may provide a lot of environmental benefits (as factories are shuttered, etc.) but it progressively creates a political push for "jobs, not the environment, full speed ahead!" attitudes. Because almost all of us are dependent on jobs for our livelihoods, we may see shouts of "Feed the poor with spotted owls!" rather than "eat the rich!" Given the balance of political power, the kind of demand growth that's needed to end this kind of gross inefficiency will likely be the kind that makes isn't environmentally sustainable. But in theory, at least, the growth of GDP up to potential would create an efficiency "dividend" that could be spent on pro-environmental stuff. (Below full employment, there _can_ be a "free lunch.) At least up to full employment, the fight should not be against growth but instead for using the dividend to help both those in need and the natural environment. It's politically problematic, yes, but there are no simple slogans that will solve the problem. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
