We live in a country where the expectation that over time we will improve our economic status may be a thing of the past. The AP has a story on our current “recovery.” It’s pretty sad, but it has been an unfortunate situation for years now, getting worse year by year for the last thirty years. ALLEN G. BREED and RICH MATTHEWS wrote the story and their insights are impressive.
Category: Economic measurement
Jon Talton Tells It Like It Is!
Jon Talton writes a new post entitled: BP: Not ‘Beyond Petroleum’ but just beyond peak; Market cap blues. It’s magnificent. You should give it your utmost attention.
Is China The Next Global Superpower? NO
Is China The Next Global Superpower? NO
Over and over again, I hear people say with complete confidence, “China will be the next world power.” Occasionally the will express sadness at the decline of the United States but continue to express confidence that soon we here in this country will be the second greatest economic power on the planet.
No, it’s not going to happen. The United States will remain the world powerhouse economic center for probably at least the next fifty years.
Why do I think this? First, the Chinese have been claiming a growth rate of 10 percent a year for the last thirty years. Very funny. I am being told that communist totalitarian state has a growth rate roughly six percent higher per year than the United States for the last forty years. The Soviet Union made similar claims. So, did the nations of Eastern Europe. How did that work out?
Since we can be totally confident that the Chinese government is cooking the books, how can we gain insight into the Chinese economy? Well, we have to use anecdotal information.
Guess what? A nineteen year old sticks a knife into the heart of a party official and becomes a local hero. The locals contend that the party official used his position for personal enrichment, stealing land and other economic possessions while having his opponents (the victims of his thefts) beaten up.
Of course, there really wasn’t any large number of sympathizers, just 20,000 or so. These people petitioned the court for leniency. The youth was sentenced to death anyway. It would set a bad precedent if you could wack a party official for corruption. Other anecdotal evidence as well as various studies says the same thing. There is an incredible amount of corruption ongoing in the “People’s” Republic of China.
But don’t just take my word for it. Take a look at this news report from AlJazeera.
Let’s be a little more skeptical about Chinese economic growth. I hear the praises of free enterprise and democracy rising to high heaven all over this country. How come we don’t apply our principles to the Chinese Communists? How come free enterprise is the best economic system in the world but they have a yearly growth rate of 10percent in a government controlled economy? Someone is lying. What’s your call?
James Pilant
How Do You Measure Happiness?
We live in a world of stories, facts and numbers. Numbers often drive politics even though many do not understand what those numbers mean. Numbers appear to be definite. One and one make two. Really? If you have two apples, that is one and one making two. What if one of the apples is rotten? Is it still two apples? What if one of the apples is smaller than a plum? Is it still two apples? What if one is a horse apple or an Adam’s apple? Numbers are simple only in theory.
Numbers also and often unfortunately drive ethical discussions: “the greatest good for the greatest number, etc.” One critical number in this society and many other is the Gross National Product. Often subjected to interpretation and re-interpretation depending on your policy view, this number is considered the measure of success for a society. That no one is exactly sure what it means or that we are often ambivalent as to whether or not money can buy happiness. We often yield to the tyranny of this number. Ethical thinking does not stop when confronted by a statistic. It is something of a wall to be climbed over but much thought has to overcome the complex and the mundane.
France has been confronting the question of how to measure the country’s prosperity, through Gross Domestic Product or the Happiness Index. Today, it was announced that GDP has won out over the other measure.
In 2007, the French Government commissioned American Economist, Joseph Stiglitz to develop economic measurements that included happiness and other quality of life measurements.
There have been modifications to the simple idea of GDP in the past. For instance the United Nations uses the Human Development Index which is based on measurements of life expectancy, education and standard of living.
Gross National Happiness measures sociological and psychological elements as well as economic ones to determine a nation’s success. It was expected that Stiglitz’s ideas would move French measurements in that direction. But it was not to be.
Pilant's Business Ethics Blog 
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