Posted on 11/04/2012 11:12:52 AM PST by mdittmar
Hiring in the long-depressed U.S. construction industry will get a boost from the rebuilding that will follow Superstorm Sandy. Those jobs, in turn, could raise economic growth, analysts say.
The modest lift to the economy is expected to come in the first months of 2013. Construction firms, contractors and local governments will hire to rebuild or renovate homes, buildings, roads and bridges that were damaged or destroyed.
"This is going to be a net positive, particularly in the mid-Atlantic," said Sophia Koropeckyj, managing director Moody's Economy.com.
Sandy inflicted up to $50 billion in estimated losses from property damage, lost business and additional living costs. The damage was concentrated near the coastlines of New Jersey and New York City.
(Excerpt) Read more at news.yahoo.com ...
As you say, an interesting side discussion.
I’d like to, tentatively, suggest that not all services, and for that matter, not all of any of the other categories mentioned, create (new) wealth.
During the days of the USSR, lots and lots of manufacturing went on, creating “stuff” that nobody wanted. Did the manufacturing of this stuff “create wealth?” I seriously doubt it. In fact, I would suggest that the time, energy and materials sunk into making this stuff reduced the country’s net wealth.
Same with services. The most obvious example is governmental regulation. Much though not all of the effort expended in these services reduces the net wealth of the economy. But of course there is a great deal of consulting and other purely private business services that reduce wealth creation.
I’ve often wondered if it would be possible to create an accurate net wealth creation index for economic activities, organizations and individuals. An activity that is entirely positive in creating wealth would be scored at +100, while one that is entirely negative would be scored at -100, with of course when consumption of wealth and generation balances, the score would be 0.
A couple of more natural disasters and we can grow our way out of debt! Who knew that climate change is good for the economy? These libtards are super-geniuses types.
A couple of more natural disasters and we can grow our way out of debt! Who knew that climate change is good for the economy? These libtards are super-geniuses types.
Given that we don't have free markets — the government regulation you mention, being the largest hindrance to free markets. Also, government taxation and spending is almost entirely outside of free market forces (although, governments do usually use competitive bids, etc. to bring some market forces to bear). Centrally-planned economies — as in the USSR, also have no free markets. Central planners attempt to use various devices (including, copying prices prevailing in free-market economies) to assign value to goods and services. These efforts always fall short of the results of free markets.
Governments use cost-benefit analysis, and other techniques to attempt to assign a value to projects. This is quite similar to the index you mention. Also, governments and think tanks have produced estimates of the cost of regulations (the -ve side of your index).
Des over there is a complete idiot.
Let me add a bit to my previous reply to you; regarding the effects of government regulations, and the value of services.
To simplify things, I’ll focus on just accounting services. All businesses use accountants — whether embedded as employees, or contracted out. I’ve stated the case for these services contributing to wealth creation — however, as a side-effect of government regulation, that is not always the case.
Businesses need accountants to see whether they’re winning or losing. Business strategy requires good accounting data (amongst other things). To the extent that accounting leads to better strategies, it definitely contributes to wealth. If all wealth-creating businesses were free to only use the accounting services they wanted to use (and pay for) — then all of those services would be contributing to wealth creation.
However, a great deal of accounting services are used only to satisfy the requirements of various regulations (taxation; affirmative action, environmental, etc.). Not all of that government-imposed accounting is a dead-weight loss; but much of it is. The dead-weight part does not contribute to wealth creation; and some of it may even destroy wealth.
I absolutely agree with you about the superiority of the free market to any sort of central planning. But let’s not give it more credit than it deserves.
Much free market spending does not generate wealth, notably that performed primarily as a display of wealth. Much of it is about as “productive” as the potlatches of the Northwest Coast Indians, where they piled up massive amounts of goods and burned them to demonstrate their wealth. And of course serves exactly the same purpose.
The superiority of the free market is only a general superiority, not a specific one. Just as evolution works in general, with the “fittest” mostly surviving, but doubtless many a beneficial mutation dying out by chance. So the market destroys many good ideas before they can come to fruit.
Which means the market, like evolution and democracy, is the worst possible way to run things, except of course for all the alternatives. It’s not that the market is particularly efficient, it’s that the other systems are so spectacularly ineffecient.
BTW, an off thought struck me the other day while reading FR. The people who believe most strongly in the free market for the economy, in this country, are often disbelievers in evolution for biology. Which is odd when you consider that the two use essentially identical mechanisms.
Meanwhile, of course, those who believe most strongly in evolution and despise the idea of a God that interferes in the world, are disproportionately opposed to the idea of the free market, wanting humans to use their superior intellect to decide winners and losers, rather than leaving it to “chance.”
Seems to me the creationist/market types are somewhat less illogical here. At least they posit an omniscient divine being to control biology, while the evolution/command economy folks rely on admittedly fallible, and inherently ignorant and corruptible humans to control the economy.
I absolutely agree with you about the superiority of the free market to any sort of central planning. But let’s not give it more credit than it deserves.
Much free market spending does not generate wealth, notably that performed primarily as a display of wealth. Much of it is about as “productive” as the potlatches of the Northwest Coast Indians, where they piled up massive amounts of goods and burned them to demonstrate their wealth. And of course serves exactly the same purpose.
The superiority of the free market is only a general superiority, not a specific one. Just as evolution works in general, with the “fittest” mostly surviving, but doubtless many a beneficial mutation dying out by chance. So the market destroys many good ideas before they can come to fruit.
Which means the market, like evolution and democracy, is the worst possible way to run things, except of course for all the alternatives. It’s not that the market is particularly efficient, it’s that the other systems are so spectacularly ineffecient.
BTW, an odd thought struck me the other day while reading FR. The people who believe most strongly in the free market for the economy, in this country, are often disbelievers in evolution for biology. Which is odd when you consider that the two use essentially identical mechanisms.
Meanwhile, of course, those who believe most strongly in evolution and despise the idea of a God that interferes in the world, are disproportionately opposed to the idea of the free market, wanting humans to use their superior intellect to decide winners and losers, rather than leaving it to “chance.”
Seems to me the creationist/market types are somewhat less illogical here. At least they posit an omniscient divine being to control biology, while the evolution/command economy folks rely on admittedly fallible, and inherently ignorant and corruptible humans to control the economy.
I also probably misunderstood entropy’s original comment, but I’m too busy to go back and look at it now.
Broken Window Fallacy, you had to know some people would go there.
did you see the comments at Yahoo?
A lot of “Duh”s
Wow, the ignorance is thick
When you denigrate “displays of wealth”, you’re substituting your values for those of the individuals “wasting” their money. That’s what central planners do by necessity — and, it’s part of the reason central planning doesn’t work. Economic man is expected to attempt to maximize “utility” — that “utility” is always subjective, and could be said to be synonymous with “wealth” (in a larger sense). Only *you* know your personal utility function; and when someone else tries to impose one on you, your “wealth” will have been reduced.
BTW, potlatches were mostly concerned with the redistribution of wealth, rather than the outright destruction of same. Prestige and social standing was attained by whoever could give away the most wealth. In that sense, potlatches weren’t very different from modern philanthropy. For instance, we see billionaires like Bill Gates becoming full time re-distributors of their wealth. In return, they get social standing (liberals adore them), and can feel good about themselves. If they value those things more than (say) more mansions, private jets, and yachts — who are we to judge?
I’ll leave the evolution/creationism Tar Baby untouched, if you don’t mind.
facepalm
Your window is broken, you spend $100 to fix it, that same $100 was going to be spent on something else. You now have the same window you had before it was broken and no gain for your $100. You have become $100 POORER.
I still don’t believe so many people think disaster is good for the economy.
There is a pretty fundamental difference between manufacturing goods no one wants due to central planning and manufacturing goods in a free market that will be bought of customers’ free will, else ultimately the manufacturing firm will go out of business at some point. If you do not understand this, why are you on a conservative web site?
Interestingly there are signs GM has been channel stuffing to pump up their numbers, so we in the U.S. are edging towards the former situation in some areas.
My employer of 23 years also employed a battery of accountants and a few lawyers.
Both contributed ZERO to making the product better, cheaper to produce or easier to sell. Just the contrary, both groups were a big drag on the bottom line. The accountants were necessary due to government requirements to figure exact taxes, depreciation etc. The lawyers were there to defend us against frivolous law suits, which they performed well. However again, it did not improve the product, make it more reliable, or cheaper to produce by 1 red cent.
Me and my neighbors take in each other’s wash for a living so I don’t get to watch Yahoo much.
Sorry, but while I recognize the free market is the only way a complex economy can run, I don’t fetishize it as being inherently and always productive in particular cases.
The free market is composed of people, and people make stupid and unproductive decisions all the time. A free market among a people who are culturally thrifty and hard-working will produce very different results and generate much more wealth in the long run than an equally free market among a people who are profligate and decadent.
Let us consider the case of crystal meth. It has come to prominence in a free market, albeit an underground and black one. The producers and consumers, who are often the same people, make voluntary decisions to engage in the market.
Yet few will disagree that this particular market destroys wealth, and people, for that matter. Were it made legal tomorrow, it would do the same.
lol
I assume the new method is more efficient and hence would process the same amount of ore with less capital investment therby freeing up capital to use for other purposes. Or process more ore etc.
In turn that freed up capital could be used to discover a still more efficient process and the cycle continued. Wealth has been created by the mixture of capital and human intelligence.
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