To set the stage, M. Blowhard had asked:
"What the heck happened to the American economy in the late 1990s or thereabouts that killed off economic growth, apparently for at least a decade?
Was it:
- Y2K (maybe we should have taken it a lot more seriously?)
- Globalization and the loss of manufacturing jobs?
- The inevitable result of paying stagnating (or even falling) wages to the vast majority of the population as a short-sighted way of ensuring high corporate profits?
- Long term fallout from the notoriously IQ-lowering hit single, “Ooops, I Did It Again”?
Moira responded with:
I think the deadly X factor is a combination of your 2nd, 3rd, and last points. Though "globalization", of course, affects more than manufacturing jobs. (And there are economists and economic writers who have long been examining the long-term ill-effects of de-industrialization and the current globalization regime.)(By the way, Richard Thompson does a dynamite cover of "Oops....".)
Is the notion of perpetual economic growth in capitalist societies (not exactly a natural trend throughout most of human history) in need of revision? Was it just a temporary thing?
I've always been puzzled by this apparent belief in "infinite growth", though I'm sure the policy-makers pushing growth as an end in itself aren't thinking in terms of logical endpoints, but narrowly in terms of specific problems they may be responsible for - increasing tax revenues, funding Social Security, etc. - in the short term. Of course, one might think that people incapable of considering the larger, longer-term welfare of a nation ought not to be entrusted with policy-making power, even if we expect a private individual - say, the owner of a home-building corporation - to lobby for GROW GROW GROW GROW GROW!...
Sure, societies are always changing, evolving, hopefully advancing and improving human life. But infinite growth, which seems to be the preferred model for both companies and nation, is an impossibility.
I'll repeat the unoriginal observation that we more and more confuse "the economy" with society, because that confusion promotes lousy (disastrous?) policy. There do seem to be a lot of people out there who don't (or can't) recognize the distinction. (Why is that? Do they mistakenly take "everything else" in civilization as given, or is the scope of their inner lives really that narrow?
Sometimes I really wonder about people. For example, I came across some Australian policy article recently which illustrated this narrowness nicely. (Which of course I've lost track of. Iirc, the group appeared to be some sort of Chamber of Commerce type quango.) On the one hand, they were not happy with a current public policy encouraging reproduction, which had been instituted because families were too small and there weren't going to be enough people of working age to "grow the economy". You see, children are a net liability on the economy, an inefficient cost sink that have to be fed, housed, and educated before they start being economically productive. On the other hand, they were all gaga for turbo-charged immigration, because that way they could get all the good-to-go workers they needed to "grow the economy". Now, one would think that any human being not beset with terminal short-termitis (or maybe autism) would begin to pick out the flaws, both technical and social, in this sort of reasoning. But after you've read enough stuff like this, you stop thinking about the technical and logical flaws and start wondering, "Wtf is wrong with these people?" And after a while you begin wondering if they're not merely blinkered and unwise, but maybe just batshit insane.
How do we intend to handle the distribution of the goodies if the pie isn’t growing?
The current economic model was sold on the premise that it was "growing the pie". Naysayers were (and still are) castigated for foolishly believing that the system is a zero-sum game. Unfortunately, the last decade or so of "globalization" has been a zero-sum game for more and more American (and other First World) workers. (And some proponents have changed arguments in mid-stream, exhorting us that it's good that we've gotten poorer so other people can be richer. Which is fine to argue, honey, but that's not what you were selling when all this started.)
As for the non-growing pie, not sure how best to deal with that. The usual line on most of the left-leaning econo-blogs I read has been that it's a simple matter of making sure all the fabulous gains of globalization are fairly spread via government-controlled redistribution programs. I dunno. Crap wages and crap working conditions ameliorated by national health care seems a lousy exchange, and indicates a much uglier and less free life, than one in which a worker can command humane working conditions, and wages good enough to attend to his and his family's needs as a free man with free choice, and not a government client. But that's just me. I recognize that we were already far down this road before the '90s. But I don't have to like it.