Comradeship // Freechat

An economy is a model for allocating labour and resources in a way that meets the needs of the people in the country.

Glances at the last 400 years of human history

That can't possibly be true.

And that's why we see absurd articles like this one arguing that the recession people are experiencing isn't real.

A recession, strictly defined, is a reduction in GDP across two successive quarters. So, academically speaking, we're absolutely correct in asserting that the recession isn't real. Because GDP grew 6.1% in 2023 and 9.1% in 2022.

That said, I'm going to turn to a page in Thomas Piketty's Capitalism in the 21st Century and note that we are experiencing an even faster rate of growth in the Return on Investment. Publicly traded assets grew on the scale of 15-30% annually, over these two years. So, we're experiencing a period in which Rate of Growth (G) < Rate of Return on Investment (R). And when G < R, the disparity between wealth groups widens. This results in more relative poverty, as consumer prices (particularly in real estate and energy) rapidly outpace the median national income.

This deprives lay people of the fruits of economic activity and drives increases in personal debts, domestic poverty, homelessness, and other economic ills.

The problem is not that we are existing in a recession. The problem is that the surplus wealth we are generating through our labor is falling into fewer and fewer hands, resulting in a decline in the quality of life for the population at large.

Measures such as the stock market and GDP were meant to act as proxies for measuring how well the economy was accomplishing its stated purpose, which is to improve the standard of living for everyone.

I would argue that they aren’t and never have been a measure of how well the economy is at distributing resources. Stocks haven’t been accessible to the working class until recently. And GDP is neither normalized to PPP nor gives any indication as to its distribution among the populace.

The “economy” (read: bourgeois economy) has never been connected to the masses. If you measure how well businesses are performing, then it only tells you how well businesses are performing. That’s why these indicators are lagging and not leading.

"economics" for the last hundred years has just been liberals inventing new ways to ignore the labor theory of value

https://taiyangyu.medium.com/addressing-common-criticisms-of-the-labor-theory-of-value-bdf49281fab

I want make WSJ writers work salt mine 👍

An economy is a model for allocating labour and resources in a way that meets the needs of the people in the country.

Economies are no more "models for allocating labour and resources" than Darwinian evolution maximizes the happiness of all species. All past societies have existed on the simple condition that they were compatible with their material bases. They are not necessarily perfect or optimized for productivity, happiness, justice, etc.

You probably didn't mean it this way, but an economy is not necessarily a consciously applied, a priori model. Most societies have not had planned economies, let alone for any purpose like meeting the needs of the population.

Of course there must be some way that societies reproduce themselves. It is typically brutal as a ruling class exploits another class, the most obvious example being the various societies based on types of slave labor.

"The history of all hitherto existing society is the history of class struggles." — The history of society has been the history of economies for the benefit of a single class, or in legal terms, the history of exclusive property rights held by privileged classes.