# The economy is a lost cause

Discussion in 'Business & Economics' started by Buddha12, Oct 18, 2012.

1. ### Buddha12Valued Senior Member

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2,862

This one chart shows all that is wrong with the economy and the middle class, and the task that will be faced by either President Barack Obama or Mitt Romney over the next four years.

Americans' idea of what their standard of living should be is based on the growth seen in the years following World War II through the early 1970s; that's the blue line in the chart. If that rate of growth had continued -- it averaged nearly 2.4% a year during that period -- GDP per capita (a proxy for wages) would be $63,500, 32% higher than it is now. Instead, since 2001, average annual GDP per capita growth -- the red line in the chart -- has clocked in at a measly 0.7%. That returns us to a pace of growth not seen since just after the Civil War. What's worse, because of the impediments to the economy listed above, the growth rate could drop as low as 0.2%, a level last suffered in the 17th century, Gordon says. For the middle class to prosper again, labor productivity and GDP per capita must reaccelerate. http://money.msn.com/investing/is-the-economy-a-lost-cause 2. ### Google AdSenseGuest Advertisement to hide all adverts. 3. ### elteValued Senior Member Messages: 1,344 Even if we solve the greed problem and sufficiently address the lack of knowledge out there, the overpopulation is the one that limits our prosperity. Bad effects of religious doctrines are largely to blame. If we had been able to contraceive way more effectively and limit the population to 10 million, everyone could have the lifestyle of kings, and within reason, there'd be plenty of everything available for everyone. It would take longer to get to prosperity, but now we are in a bind, and efforts to utilize Earth's resources are largely counterproductive. I attribute this trouble to ethical development that has been too slow. 4. ### Google AdSenseGuest Advertisement to hide all adverts. 5. ### JeevesValued Senior Member Messages: 5,028 Capitalism takes the worshipping impulse to an extreme of absurdity, without shedding any of the old absurdities. Lo, I give you a new commandment: Money was made for Man; not Man for Money. Heads of state who own vast, lethal, technologically sophisticated armies are yet reduced to quivering, incompetent jelly at the sight of a ledger. Nobody asks why. 6. ### Google AdSenseGuest Advertisement to hide all adverts. 7. ### elteValued Senior Member Messages: 1,344 8. ### spidergoatLiddle' Dick TaterValued Senior Member Messages: 53,966 Energy is also a limiting factor. 9. ### Fraggle RockerStaff Member Messages: 24,690 The human birth rate began to decrease thirty years ago. It is universally predicted to drop to zero before the end of this century--and continue falling. 10. ### quadraphonicsBloodthirsty BarbarianValued Senior Member Messages: 9,391 Is it? And if so, is that justifiable? Is it reasonable to expect that the growth rates of that particular generation ought to continue indefinitely? Various aspects of the country, world, technology, etc. have changed a lot since then. What is a reasonable expectation regarding growth rates in subsequent decades? 11. ### elteValued Senior Member Messages: 1,344 I think it's too late, though. Yet, that is based on what we are familiart with. Say we figure out a way to basically remove ourselves from the environment by some yet to be developed discovery or method, then the future could still be good for everyone. 12. ### spidergoatLiddle' Dick TaterValued Senior Member Messages: 53,966 Population is less important than energy. And Indian family of 10 probably use less energy and are less of a burden on the environment than one American. 13. ### elteValued Senior Member Messages: 1,344 I think energy is the most important thing, too. Maybe I'm too old, but I couldn't even live without it, though I have developed ways to use much less than most people. But the electric devices I use are critical to my existence. Yet, due to the large population just functioning on the planet, we are ruining it for sustaining us. For example, the Ganges river is very polluted, from what I've picked up. India's water table has gotten very low, and I've read that in many places in the US, half of the topsoil is already gone due to farming. If we were to burn trees for energy, the wood contains components of the soil and eventually, the soil would get used up from that alone. The one guy across the valley burning wood fowls the air so much that I often have to shut off the fresh air intake. The planet can't sustain us unless we get much more clever at living on it. 14. ### CowboyMy Aim Is TrueValued Senior Member Messages: 3,707 What makes you think that keeping our population absurdly low would allow us all to live like kings? 15. ### elteValued Senior Member Messages: 1,344 I don't see justification for your tone. 16. ### CowboyMy Aim Is TrueValued Senior Member Messages: 3,707 What tone? I was asking a question. 17. ### elteValued Senior Member Messages: 1,344 If one desires an answer, he or she should ask nicely. The Internet personas of people that I interact with online don't change my requirement for online etiquette. 18. ### CowboyMy Aim Is TrueValued Senior Member Messages: 3,707 The hypersensitivity of the people I interact with online doesn't change my requirement for logic-based arguments. Welcome to ignore. 19. ### CarcanoValued Senior Member Messages: 6,865 Which humans??? The birth rate among europeans has dropped below replacement levels while other cultures continue to expand. Declining populations are fatal for economies with high levels of debt...like ours. 20. ### Aqueous Idflat Earth skepticValued Senior Member Messages: 6,152 What you really mean is: you wish you had more money, you wish everyone had more money, and since we're not getting more money (to the tune of about$10-20k) then the economy must be bad.

The chart purports to show a problem with the economy, but it doesn't. It purports to show that you can arbitrarily pick the trend in GDP growth during one generation, the Boomers, and establish it as a yardstick for evaluating all other trends. But while it's doing that, it's obscuring the fact that GDP has tripled since the Baby Boom.

I doubt if the middle class of the Baby Boom would tell you they were prospering. Prosperity is a very relative concept. A person might complain that he's not prospering because he can't afford a huge flat panel screen or a badass car. Compare that with the folks back in the day who were lucky to afford a small home, a no-frills car, and peanut butter, bologna and hot dogs as a standard fare.

To get a picture of how much more prosperous people are today, you need only compare the number of luxury homes that have sprung up since 1972, the badass cars (by Boomer standards) that choke the roads during rush hour, and all the frivolous gadgets and comforts people have today which they could not have afforded back in the day.

21. ### Aqueous Idflat Earth skepticValued Senior Member

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6,152
If the graph is to be believed (I don't) that this is our metric, then people were doing best when they were having babies out the wazoo. But (among other things) it's a simplification. Women were stuck at home, the free housekeepers of the lord of the manor, blacks and hispanics were an oppressed and exploited underclass, and world poverty and hunger were rampant. Considering how all of that has changed, I think we've done quite well.

I think the question is this: how much stuff does it take to make people happy? Maybe the Baby Boom just produced a bunch of whiners. Maybe all we've lost is our sense of humor.