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What keeps the modern economy going

Discussion in 'Speaker's Corner' started by humbug, Apr 1, 2019.

  1. NickK


    Joined: Jan 13, 2003

    Posts: 18,066

    Trading debts has been part of the economy for years. A debt to reclaim is an asset..
  2. a1ex2001


    Joined: Mar 14, 2005

    Posts: 11,701

    Location: Here and There...

    Growth is the key to the world economy, we have to have continual growth of consumption, output and inflation to allow the endless debt circle to be complete. We might be hitting a big issue with the decline in working age population in the coming years which means output may struggle to grow in line with consumption which may break the inflation model and destroy the debt circle.
  3. Stretch


    Joined: Feb 14, 2004

    Posts: 11,538

    Location: Cambridge

    You seem to be implying that society undervalues refuse workers when compared to bank mangers because they're paid less.

    I don't see how anything you written invalidates my statement.
  4. 4K8KW10


    Joined: Sep 2, 2017

    Posts: 6,858

    Choice generates envy, arguments and therefore problems among the people. Ultimately, it creates greed.
    Normally, people are not that different compared to each other. If you go out on the street, you will see dozens of cars and very rarely the same make as yours.

    Normally, people can live with much less - for example:
    A house for 50,000, instead of 300,000;
    A car for 15,000, instead of 35,000;
    A phone for 150, instead of 550;
    A washing machine for 250, instead of 750;
    A TV set for 500, instead of 2000,

    etc, etc.

    We have a very serious problem with this so called "best system". Actually, I begin to suspect that capitalism is the real antichrist. Or that the satan took the image of God and lies everyone that it's good.
    You can't wipe 60% of the animal species on the Planet in some 50 years (since 1960s), and double or triple the CO2 in the atmosphere without doing anything meaningful to change these bad practices, and to call it but it's the best.
    No, it isn't.
  5. Vexr

    Wise Guy

    Joined: Oct 15, 2018

    Posts: 1,047

    I'd say the unassailable complexity of the nuclear deterrent with its mutually assured destruction has done far more than capitalism to preserve peace.

    A good author on the subject of debt / capitalism and former economist under the Reagan administration (who has a very bleak view of where capitalism is going indeed) wrote The Failure of Laissez-Faire Capitalism:


    As for the idea we're borrowing against each other / sensible savers, well IIRC when we take out a loan the bank creates the money out of thin air with a very small fee, at near 0% interest rate, from whatever central bank the country has. This process is completely segregated from whatever deposits those make to the bank. This sort of strategy led to the Great Depression, and was later addressed with the Glass-Steagall legislation (https://en.wikipedia.org/wiki/Glass–Steagall_legislation).

    Unfortunately Bill Clinton repealed that in the 90s and set the wheel in motion for the 2008 financial crash. Tony Blair / New Labour, effectively trying to clone the Democrats and Clinton in the US, set out on the same course of financial deregulation in favour of the self-correcting markets that only relinquishing power to the private / banking sector could apparently achieve. We know how that ended. Recalling Ed Milliband stating what happened there as he was sneered at by our beloved David Cameron and called 'weak and despicable' now resonates differently so many years on.

    Another interesting idea I've heard is that socialism would now be achievable in the current climate of 'peak stuff' we live in. For the first time in history we are no longer short of commodities and are apparently in a climate where socialism could work.

    This kind of talk regarding capitalism echoes the debates of about 1890-1910, where those in the newly forming socialist movement in the West were giving serious thought to the question of why should the rich get richer and everyone else be indentured servants? Jack London with his novel The Iron Heel novel raises such questions.