Posted on 04/16/2015 9:57:34 AM PDT by fredericbastiat1
If you listen to the news on the economy or financial markets, you have probably heard statements like “consumption drives the American economy,” or “consumption is 70% of the economy.”
But in a new book out that follows in the footsteps of Henry Hazlitt’s classic “Economics in One Lesson” — though in a much more fun package — titled “Popular Economics: What the Rolling Stones, Downton Abbey, and LeBron James Can Teach You about Economics,” Forbes and RealClearMarkets Editor, and senior economic advisor to Toreador Research and Trading John Tamny challenges this and much other “conventional wisdom” on taxes, regulations, trade and money.
In an in-depth interview with Mr. Tamny, I asked him in particular about the notion that consumption drives economic growth, to which he responded:
(Excerpt) Read more at theblaze.com ...
I agree. There is no doubt that the Kenyon’s Keynesian approach - focusing merely on consumption - is bunk. And the left is determined that they do nothing to benefit the producers in any way.
Obviously from a businesses perspective you can not merely produce - without knowing that you have a willing and able market in which to sell. From an economic policies perspective, it should be obvious that the best remedy for our sluggish economy is to simply remove the fiscal & regulatory dis-incentives to businesses and entrepreneurs; but of course the left will have none of that...
Of course while Americans are far more productive than we were decades past, for over a year now Business Sector Productivity has been faltering like it did years ago back when the '08 crisis hit. Making me nervous.
Then again, my take is that the big point of the piece was "the notion that consumption drives economic growth". What a crock. Like saying the key to good farming is sitting around eating food all day. Astounding how half of the U.S. actually believes that.
People buy what they are familiar with. It is called brand name recognition. People buy Ford because they own Fords. Ditto for Apple.
“Astounding how half of the U.S. actually believes that. “
The balance bwetween productivity/consumption doesn’t bother me as much as the notion that they feel entitled to consume as much as the productive amongst us out of fairness.
Ingenuity had everything to do with it. Since the invention of the wheel we have been making incremental improvements on the concept through ingenuity.
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