Capitalism, what have you done for me lately?

Ross Elliot's picture
Submitted by Ross Elliot on Wed, 2006-05-03 01:46

From Prof. Reisman's blog:

Read the whole post. Quite funny.

Prof. Reisman's Blog Post

The following paragraph should be memorised and hurled at any of those sniffling, simpering, loopy-lefty, bed-wetting freaksters that you may from time to time encounter:

"...thanks to the substantial application of the free-market principles of Austrian economics (and before that, Classical economics), saving and capital accumulation were tremendously encouraged along with scientific and technological progress. On this foundation the productivity of labor rapidly increased, resulting in more abundant supplies of food, clothing, and housing per capita, and improved sanitation and hygiene. As a result infant mortality radically declined, life expectancy greatly increased, the average person became able to afford to work fewer hours, child labor was progressively eliminated, and for the first time in human history, it became possible for the average person to have access to books, music, art, and education."


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Thanks for being so ortho-Ed-ic ...

Ed's picture

Tim,

Thanks for straightening me out on this issue. From now on, Real Wealth it is: Man, oh man, that's some REAL WEALTH you got right there!

"Man is a hero and worthy of worship."

Semantics

Tim S's picture

The term PPP really isn't very good in that context. If you were to talk about a decline in "purchasing power", then everyone would think you were talking about inflation, not wealth, so you would be mixing up real and nominal effects, if you catch my drift.

A decline in "purchasing power parity" would make even less sense, because all it means is that the two things become less equal (e.g. nominal wealth yesterday is less equal to nominal wealth today), which is really an uninteresting statement because you wouldn't expect equality of the two things in the first place.

And btw, all economics is inconsequential. Didn't you know that? Smiling

Yeah, 'real wealth,' that's it. But ...

Ed's picture

... can't we use the concept of median PPP across time in the SAME country? Doesn't that amount to a great measure of the economic prosperity of a nation? I use 'median' instead of 'mean,' in order to drive the point home that the tides of true capitalism raise all boats some (not some at the expense of others).

Calling it PPP or 'real wealth' seems (to me) to be rather inconsequential semantics (though it may be considered 'unprofessional').

Ed

"Man is a hero and worthy of worship."

Real wealth

Tim S's picture

"we are now in a decline of purchasing power parity (PPP)."

Erm ... I think the term you want is "real wealth". Purchasing power parity is the notion that goods and services should cost the same in different countries after the effect of currency differentials is removed (i.e. when their price is measured in the same currency).

Per capita GDP doubling time

Ed's picture

Since about 1870 (in the US), the Per capita GDP doubling time has been about 30 years. Want to be twice as rich? Wait 30 years (and it will happen). That's the power of capitalism. From 1780-1980, our purchasing power increased 8-fold. Unfortunately though (due to currently unchecked statism), we are now in a decline of purchasing power parity (PPP).

Man is a hero and worthy of worship.

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