The Social Contract?

[Sikander]

Originally posted by Tingkai

If inflation increases, people move money overseas, but that pushes down the value of the local currencies. If the economy is highly reliant on imports, inflation could increase.

Also, increased outflows of money, in and of itself, do not necessarily put downward pressure on inflation.

True, but sending the money overseas will reduce the amount available to loan locally which will tend to do so. And this of course all assumes that there will be inflation in the first place, a scenario that is far more likely if the government has huge unfunded liabilities in the form of pensions, which wouldn't be the case in my scheme.

[aneeshm]

Originally posted by Albert Speer
Ben:



yeah right... like that happens...

Well , yes , it does happen (at least in India) . And it's the norm , not the exception . Your parents pay for your college education , and schooling , and everything until you get your own job . Then , when they are no longer working , you take care of them (at least financially) .

[pchang]

Originally posted by Tingkai
Conversely, the HDI is based on "hard" facts: # of doctors, # of university graduates, average age at death, # of births, etc.

To suggest that the HDI is pulled out of thin air is simply wrong.

However, what do those "hard" facts mean? That is what is pulled out of thin air. Does more doctors mean better health? Not necessarily. Does a high # of births indicate worse living conditions? Not necessarily.

[chequita guevara]

Originally posted by Ned
There is a third alternative:

Grow the economy.

That is Bush's plan in major part.

It's not working, at least as he claimed it would. He said it would create 300,000 new jobs a month. It's been over a year, and it's only been slightly more than 100,000 a month. This might seem good, but 150,000 new jobs a month need to be created just to keep up with demographic growth.

The other part is to hold the line on new spending.

He's sure done a bang up job on that, hasn't he. He' not even pretending to be a fiscal conservative anymore. He's floated several new major programs which will costs serious money, and that doesn't even include things that need to be done, like funding Homeland Security properly.

[Kidlicious]

Originally posted by Oerdin
Wrong again. They use GDP as one indicator among hundreds because it is a hard number which can be compared and calculated completely objectively without any individual economist injecting bias into the results.

They want to root out subjective bias by dealing with hard facts and calculatable figures as much as possible. That helps economists make sure they are comparing apples to apples.

Who do you think created economics, God? No, men did. Rich men specifically with ties to business. There's a reason why the consentrate on GDP because that is a terrific indicator of profit. Does in indicate other things? A little bit, but it doesn't aim too. These economists already had the goal of more profit before they created economics. Of course it's subjective.

[Kidlicious]

Originally posted by Oerdin


No they are not. Economic satistics try very hard to remain objective and to remove the subjective. That's why they do so much math and crunching of numbers because in math you can arrive at a completely objective conclusion. They compare total economic out put, out put per person, total number of jobs, the number of unemployed... basically they work hard to find things with real numbers which can be counted and then compared thus minimizing the subjective and concentrating in the objective.

The UN's Human Development Index does the exact opposite. They high light the subjective and only then do they sprinkle in a bit of the objective in order to justify their conclusions.

Using math doesn't make you objective. You have to chose your goals first. Then you use math to pursue those goals. That's exactly what economists have done. Their goal is profit, and they use math to increase their profit. It's totally subjective.

[pchang]

The goal of economists is to correctly model human behavior.

[Kidlicious]

Originally posted by pchang
The goal of economists is to correctly model human behavior.

To maximize profit.

[pchang]

The tendency of hammers is to see everything else as a nail.

[Kidlicious]

Well, if you study the history of economic thought you will clearly see that profit is the original goal. The other goals only lead to the top goal. Profit. Do you think Adam Smith was talking about the amount of doctors in England? No. He was talking about business men making more profit.

[chequita guevara]

Originally posted by pchang
The tendency of hammers is to see everything else as a nail.

Subtle.

[pchang]

Its an internet forum - why be subtle?

[Kidlicious]

pchang,

I spent a good part of my life, including the time that I studied economics, not being able to recognize those nails for what they were. There's two sides of that.