Wouldn’t it be fun if Ritchie understood economics?

I keep coming back to a simple fact which cannot be avoided. This is that there are at the end of the day four components to our national income. They are consumer spending, private sector investment in business and housing, government spending and net trade balances. That’s it.

Err, no. Those are the four determinants of our national expenditure.

True, the way we calculate GDP expenditure equals income. But those really are the components of how we spend it, not how we earn our income.

14 thoughts on “Wouldn’t it be fun if Ritchie understood economics?”

  1. Tonight, apparently, Murphy is in ‘debate’ with Art Laffer at the Oxford Union although the details seem a bit vague as to what is going on and I doubt Murphy is capable of ‘debate’ with anyone as all he does is shout his opinion loudly and denounce anyone who opposes him as a ‘neo-liberal’.

  2. Expenditure under the ‘I’ for investment is also misrepresented. Investment in GDP is gross fixed capital formation by all sectors not just private. Public capital expenditure is included in ‘I’. In fact when Keynes was discussing using public expenditure as a macro policy instrument he focused exclusively on ‘I’. Now the proponents argue in terms of ‘G’ and ‘T’.

  3. “our national income”: but he doesn’t think it’s ours, he thinks it is, or ought to be, his, to dispose of as he wishes.

  4. “a simple fact” and “at the end of the day” are the clichés of the simplistic and the dogmatic. And Ritchie is both.

  5. “Wouldn’t it be fun if Ritchie understood economics?”

    Not for him. He wouldn’t be able to spout such b*ll*cks in return for his fat cheque from his trade union chums.

  6. What does he mean by ‘National Income’? Money coming into the State coffers? Income from exports?

    Never mind, I don’t really want to know – just the fact that he’s relentlessly wrong and too thick to know it is enough for me.

  7. On G&T, what happens if someone is convicted under the new drink drive limit in Scotland shire at a number that is legal in 90% of the UK?

    Can they still drive in England?

    What is the legal basis for that?

    IMO this is just another ineffective micro-jerk from the micro-jerks who currently run the SG.

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