Tuesday, January 29, 2013

Did economic growth in the 1960s make us happy?

Maybe I'm wrong but I think it is now common knowledge that mainstream economic theory doesn't take account of the role of energy and other natural resources in making economic growth possible, or at least promoting it. In any case, I'm not sure that anybody really understands how the Gross Domestic Product of their nation was continuing to grow for decade after decade whilst  the quality of our lives was diminishing year by year.  Is economic growth merely a statistical measure?  If it is, why is it so important?  After all, government can fiddle the stats anytime.

Sure it's good for Government to have steadily-increasing revenues, but can't they simply put some extra digits on a balance sheet and bring into creation these revenues?  Such an action would drop the value of the domestic currency on the world's foreign exchange markets but that'll mean the nation's exports will be more competitive and that's good, isn't it?  Hmmmm, why didn't Greece, Ireland, Portugal and Spain think of that?  (What would happen if every nation devalued its currency this way?)

Private businesses, on the other hand, also want their profit base to be sustained and to grow.  However, haven't the world's big corporations long stopped producing anything of real value for people anyway?   Of course, any business that is Too Big to Fail can be bailed out with no questions asked, as was done in 2008 using trillions of dollars in the world's most prominent reserve currency under the US government's TARP program. These are certainly the days of financialisation.

Most monetary transactions today have very little to do with actually producing services and things of real value for people.  At the same time, the intensity of exploitation of humans and nature seems to be ramped up with every passing month.

In the 1960s, the vast excess of money had not yet thrown a monkey wrench into the machine of investment. [1]  It was a different world.  The level of production of real things sold per capita was much higher than it is now in the world's richest industrialised nations.

Therefore, I believe that it would be helpful for the baby boomers like myself to try and remember what the lives of our more privileged parents were like in their decades of so-called 'peak prosperity'. In their time, the purported social joy of the 'economic growth' experience was at its historical summit.  The 'happy days' of the 1960s was an era when a middle class family could be supported by one full time and secure job only.

This week I finished reading a book allegedly written by a descendant of the poet John Keats (who shares his name).  The book is entitled 'The New Romans - an American Experience'.  It was published in 1969 when the author was 49 years of age.  So, Mr Keats was born in 1920 (he died in 2000) and experienced the Great Depression when he was a teenager 'sowing his oats'.  At the age of 21 he was recruited into the military to serve in World War II and, at the end of the war, he and his young bride and two year old son found themselves living in a small apartment twenty minutes by bus from downtown Washington on the east coast of the USA.

Keat's observed that the post World War II way of life in the US was absolutely different from any American way of life he remembered, and it fascinated him.  The nation's vast apartment housing projects with housing developments that "were sold to veterans for nothing down other than a promise to pay an inflated price for thirty years" were a fact of life for "hundreds of thousands of young people like ourselves."  He details many aspects of the ordinary, but revolutionised, life of he and his peers and provides insightful reflections on the ubiquitous emptiness of the experience for most people.

"...people cannot live in machines that are run by systems....five square miles of the same thing...an immense area [that was] ...filled with the same kind of people...same age, same number of small children, same kind of problems and possessions...same kind of jobs [mostly in Government]."

Keats spelt it out.  Life for his generation became a kind of 'rat race'.  America was impersonal.  To its people it provided mass housing, mass markets, massive corporations, massive government, mass media and massive boredom.  The human response, he writes, to such an inhuman system is "inventive circumvention".  This sounds very credible.  I've read that the disastrous spate of 'deregulation' of the world's global financial markets came about due to the powerlessness of regulators to cope with the creative circumvention of global players, for instance.

A novel thing for our mainstream (mass) media to do would be to focus on the great questions of our time.  Questions such as:

  •  how things are produced and who decides?
  • who gets to be bailed out and why?
  • what is capitalism when government and corporations share an interlocking directorate of the same managers?
  • how can life be less impersonal?
  • should we diminish the role of 'the market' in favour of the cooperative or altruistic provision of human and environmental need?
I know that I don't want to see people living under the concentrated power of big government or big business.  I think my values are more in tune with those of the traditional family farmer and householder in the nineteenth century.  It is the incorporation into my life of a much greater role for community as well as genuine individual effort and labour and a much smaller role for corporations.

I'd like to be a recognisable human being.  Who wouldn't?  


REFERENCES:
[1]  The Tangled Relationship Between Wealth and Money - And why we're focusing on the wrong economic 'fixes'

by John Michael Greer
Tuesday, January 22, 2013, 8:43 AM
http://www.peakprosperity.com/blog/80556/tangled-relationship-wealth-money

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