On the future of the economy

Well, true….

Those who favour “stimulating” the economy often employ a medical metaphor. The economy is a dying patient. Questions about the long-term effects of its treatment are irrelevant. All that matters now is keeping it alive.

They are foolish to employ this metaphor. Economies cannot die. Even during the Great Depression of the 1930s the economy lived on. The gross domestic product of most industrial countries dropped by about 30 per cent. I am not sure how to translate that into the medical metaphor. Moving 30 per cent less? Losing 30 per cent of your body weight? Whatever: it is not the same as dying.

But there are places like the Congo and Zimbabwe (or Pol Pot´s Cambodia) where the economy does, in any realistic sense, die.

Fortunately, we´re safe from that as for such to happen you need a power crazed autocrat willing to do anything at all to remain in power.

Oh, wait…..

4 comments on “On the future of the economy

  1. He won’t (really) apologise, and he won’t go – no not at all. The point as you have well made is power, just that. to be “in power” – it does not even matter to these GramscoFabiaNazis if everybody else is in prison, such as in North Korea or Cuba for instance – so long as “one is in power”.

    I often think of Ceaucescu these days – anyone remember him? At least Sarah Hobbsbawm does not claim to be the mother of her people, we are spared that, yet.

  2. The more subtle, but more dangerous problem with the metaphor is that it relies on the idea that the government is outside the economy, just as the doctor is outside the patient. The doctor an bring external resources to bear. The government cannot; in order to stimulate the body it has to draw on the body’s own resources, because the government is itself part of the body, and the finance it uses for stimulus is from the productive economy itself.

    A better metaphor would be that of a starving man who eats his own leg. Although he may achieve a temporary vigour, there is now less of him than there was and, once the leg is gone, he begins to starve again.

  3. To me the metaphor is one of an otherwise healthy person ebbing away under the strain of supporting a massive, progressive tumour – the State.

    Unless the blood supply – revenue – is kept severely in check, it will keep growing and stimulate the body to create new blood vessels – taxes – to supply even more blood and so it goes on.

    The State is a parasite on the body. A small parasite can be tolerated, but once it grows beyond a certain size it begins to cause pain and debilitation.

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