For the country as a whole, of course, the stock of wealth ultimately determines the flow of consumption that could be derived. However, there are so many uncertainties regarding it (if we believe predictions of a decade left until the climate tipping point, for example, what's the value of wealth accumulated in coal generation? what's housing stock of a country worth? what are the political constraints inherent in a particular wealth distribution?) and the way it could be translated into the current consumption (a "derivative"), that I'd rather look at medium-size rolling window moving average of HDI with GNI replacing GDP to get some idea of underlying trends.
hmmm.
my government does not provide security, I buy guns and burglar alarms and bars for my windows. more consumption. good!
my government does nothing to regulate the release of toxins into my food, water, and air. despite buying my own water filter system (more consumption: good!) to protect my family from contaminated water, I am diagnosed with cancer or emphysema or a neurological disorder and have to buy expensive treatments and pharmaceuticals to stay alive. more consumption. good!
my house is broken into and my TV and stereo and computer are stolen so I have to buy new ones. more consumption. good!
my public school system is falling into bankruptcy and disrepair so I enroll my child in an expensive private school. more consumption. good!
my point is obvious: simple measures of "consumption" are simply insane, even in the absence of true energy and environmental costs. not all consumption is the same.
some consumption increases my quality of life in some immediate way, even if shallow or temporary: I buy a rack of [pastured organic!] lamb and make a really memorable dinner for friends and family; I have the local shop tune up my bicycle for a much more pleasant and fun ride; I buy a book that keeps me fascinated for hours; I buy a nice comfortable chair to read in. other consumption is done merely to maintain an accustomed level of convenience: my hard drive dies so I replace it, my cell phone dies so I replace it. and yet other consumption is done to recover from or try to fend off disaster or misfortune: I have to get my bike mended because some jerk in an SUV sideswiped me; I have to buy medications and treatments for injury or illness; I have to replace stolen stuff; I have to spend money on defences or armaments against predation.
if categories B and C here far outweigh category A, then rising levels of consumption are bad news. they mean that products are shoddy and misfortune is commonplace. which is... actually... kinda where a lot of the industrial workforce is wrt expenditures at present. The difference between theory and practise in practise ...
Second, if the public school system is falling into disrepair, it probably means not enough money is collected to run it. And some of that money goes into the private school system instead. What's the basic difference - unless you are willing to argue that the public schools are inherently more efficient, and this reallocation is a net loss to the society. The difference is at most of second order even in this case.
There are many other examples of things that according to some value judgement are pure waste - watching Hollywood movies, eating fast food, donating your time or money to charity, or driving a sports car are examples for people I know. Still, other people do value them. Some people buy guns for pure fun and because gun possession satisfies them - probably, in a way you or I would enjoy a good book or a nice picture on the wall.
if categories B and C here far outweigh category A, then rising levels of consumption are bad news. they mean that products are shoddy and misfortune is commonplace. which is... actually... kinda where a lot of the industrial workforce is wrt expenditures at present.
Actually, consumption could be a better measure than GNI, because inequality in consumptions tends to be significantly less than in income, thus aggregation is less of an issue.
May indeed be horror -- to the child... *Lunatic*, n. One whose delusions are out of fashion.
actually my point was not (for once) about making moral assessments of the ways people spend money, just drawing an (imho essential and overlooked) distinction between spending money in a discretionary way, for pleasure or benefit, and "having to" spend money to compensate for injuries, misfortunes, crimes, degradation of the quality of life, etc. all yr examples above fall into Cat A for the purposes of my argument here; though we could wrangle about their true-cost to the society at large and hence their desirability as consumption behaviours, they are gratifying to the individual making the expenditure, and hence not Cat B or Cat C (red-queen expenses and damage-control expenses).
the sports car is a Cat A expenditure -- fun, pleasing, gratifying; the hospital bill after the car crash is a Cat C. in many cases (certainly seems to generalise to society as a whole), an excess of Cat A leads to a rising tide of Cat B and Cat C. actually this seems axiomatic if we're on a finite planet, which we are. The difference between theory and practise in practise ...
I love your examples. On the supply side:
Low pay, less leisure, more production. Good!
We must not count comfortable leisure time as a valued product -- it would make growth worshipers' heads explode. Messy. (But on second thought: ....more cleanup work. Good!...) Words and ideas I offer here may be used freely and without attribution.
Ultimately, it's the broadly defined consumption over the life span of all currently living inhabitants of the country
Created by the United Nations Development Program (UNDP), the Human Development Index is a summary composite index that measures a country's average achievements in three basic aspects of human development: longevity, knowledge, and a decent standard of living."
I used "ethical grounds" because most of the counter-arguments against using consumption seem to be grounded in ethics.
And I was talking about a medium-run average of consumption, not instantaneous one. It's possible to maintain high consumption standards for some time by recklessly letting your capital stock (wealth) depreciate, or by exploiting natural resources. That's why a longer view is needed.
b) as ultimately material well-being is related to consumption, this is the measure that should be used - the integral of it over time, anyway.
c) it's very easy to damn GDP but hard to come up with viable alternatives that could be used in all countries, that's why it's used despite the shortcomings. Just like the democracy, you see.
b. I could go for the integral of GNI as telling us something more useful.
c. I'm not convinced that hiding the subtleties of reality behind a single index is going to tell us a damn thing. To that extent, HDI is just as intrinsically flawed as GDP - neither mean anything much out of context.
... and ownership of all that real estate would pass into the hands of industrial-northern financiers. Just coincidentally, of course. The difference between theory and practise in practise ...
If people didn't have mortgages and rents to pay, they'd be much less willing to stay in the rat race... Un roi sans divertissement est un homme plein de misères
IANAE, and all that. We have met the enemy, and he is us — Pogo
So, yes, I understand your argument about infrastructure. But take the UK, where the infrastructure hasn't been kept up to the point where, even if it's still a "wealthier" country than Ireland, it costs a lot of money just to move around and this is reflected in the GDP (PPP) albeit in a different way from how lack of infrastructure affects Ireland. We have met the enemy, and he is us — Pogo
But there's also the Norwegian attitude to land ownership and use, which is one of the principal issues they have with the EU's approach to property ownership and the free market.
Norwegians fundamentally do not allow "absentee" landlordism - although it has gradually been insinuated as the "Anglo Disease" has crept in. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Odelsrett - Wikipedia, the free encyclopedia
The Odelsrett is an ancient Scandinavian allodial title which has survived in Norway as odelsrett
This law has been an important building block on which a stable and thriving farming community has been instrumental in sustaining local communities all over the country.
That is why I regard partnership-based "Open Corporate" (eg UK LLP) agreements as a form of "Legal XML" capable of linking disparate jurisdictions and legal persons in the same way that XML links disparate hardware and software.
The Semantic Web: Law is Code. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
These old Viking laws are still FUNDAMENTAL to the Norwegian way of life, and no EU law should be allowed to 'dilute' them, IMO.
It may be a better EU if they adopted them...;-)
And by the way, they also apply in Orkney and Shetland as Udal title...
I would suggest that a better understanding of how societies have developed in the Nordic countries may give food for thought to the (still, IMO) Empire building attitudes of the larger EU countries.
Maybe I should sit down one day...
Heck, I'd not be surprised if Seth Efrica topped the list amongst African countries. I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
Fortunately the world appears to have passed peak snow so the US will not be at so much of a disadvantage. Any idiot can face a crisis - it's day to day living that wears you out.
Perhaps it's posession of snow that does it
I guess you meant that as a joke, but I believe there may be an element of truth there.
A harsh climate may have something to do with how Norwegian/Nordic societies have developed.
It is necessary to co-operate and share to survive in these conditions. Add to the climate 'problems', the fact that only 4% of Norway's landmass is agricultural land - and therefore hugely valuable to a community - and you will understand that we need laws to ensure that land is farmed. These laws have worked well, and have ensured that we still have a self-owning farming community - although the farms are very small compared to most in Europe.
The EU claims these land laws violate 'human rights', and probably a few other free market rules...(enough said...I better not start another anti-EU discussion...hides...)
Sven something rather similar once ago:
Sven Triloqvist:
Neither should one forget the deep psychological historical effect of winter. If you didn't prepare for winter, you died. Food and energy had to be stored or preserved. The elements also had tp be respected. Though this may seem trite, I believe that this 'looking, planning ahead' and respect for nature are essential ingredients in the Nordic psyche leading to the attributes described in this diary.
Neither should one forget the deep psychological historical effect of winter. If you didn't prepare for winter, you died. Food and energy had to be stored or preserved. The elements also had tp be respected.
Though this may seem trite, I believe that this 'looking, planning ahead' and respect for nature are essential ingredients in the Nordic psyche leading to the attributes described in this diary.
As I mention in response to Sven, there is conventional wisdom in Japan as well that very limited natural resources, geography, climate, and frequent earthquakes had enormous influence on the development of Japanese culture.
Now I am really looking forward to that diary! (as well as ThatBritGuy's, though on a different topic.) Truth unfolds in time through a communal process.
As for Solveig, she tells she may have a title.
But the Diary itself may take a little more time, cos she's a Virgo and she likes to have her sources TIDY..... "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
They have helped reduce strike rates, foster more responsible management practices, and been a major factor in attracting large scale foreign direct investment in Ireland - including many of the best and most hi-tech employers in the world.
Sure, there is also greater inequality in Ireland than in many of the more long standing wealthy European countries, and social development has certainly lagged behind. But Ireland does have one of the highest minimum wage rates in the world, one of the best (relatively) free education systems, and has invested huge sums in improving the public health system - without much actual improvement to date.
The fact that a multi-national retailer, long noted for paying slightly above the going rate, now wants to pay just the nationally negotiated minimum increases in pay - at a time of increasing unemployment and competitive pressures - is hardly remarkable or indicative of why Ireland is moving up the HDI.
I'm not sure to what degree the HDI takes income inequality into account, but there is no doubt that the very rapid rise in Ireland's GDP/capita - whilst by no means equally distributed - has certainly benefited almost all sectors of society - witness the reduction in unemployment rate from 18% in the late '80s to 4% now.
There will always be an argument between the proponents of theories of relative and absolute inequality/poverty but lets not forget that the wealth has to be produced before it can be redistributed, and Ireland's reduction of foreign debt as a % of GDP from c. 100% to c. 30% now alone means that less of a burden is being transfered from the older generation to the new. Index of Frank's Diaries
My point was that labour market conditions have changed dramatically in the past few months, and a "free market" negotiated pay rise might now be actually lower than the socially negotiated one. Hence my reference to the relatively high Irish minimum wage (c. €9/hr.)
I would have thought what was interesting about the HDI list was that it was precisely those countries with a relatively strong "social market", state economic planning, and a consensual approach to social conflict resolution that have done particularly well - with the possible exception of Australia which has now also moved in that direction. The U.S. with much more of a free market bias under the Republicans has actually moved down the list.
It seems that - contrary to some ideologists - free market and human development are not quite the same thing! Index of Frank's Diaries
It seems that - contrary to some ideologists - free market and human development are not quite the same thing!
I'm not sure I understand the point being made by the main article. The existence of national wage agreements and the existence of industrial dispute resolution processes (such as the National implementation body) have been one of the main factors behind the Celtic Tiger and Ireland's gradual rise up the HDI food chain.
But something just doesn't seem right here: "Rich, free-market countries dominate the top places, with Iceland, Norway, Australia, Canada and Ireland making up the first five." What's wrong with that picture?
But something just doesn't seem right here: "Rich, free-market countries dominate the top places, with Iceland, Norway, Australia, Canada and Ireland making up the first five."
What's wrong with that picture?
