The addiction to cheapness makes the economy especially ‘fragile’

There are some things that ‘should’ , it seems, be cheap: food, ‘labour’ and consumer goods are most usually cited….

What isn’t ever cheap is housing – whether purchased or rented – indeed any ‘real estate’ property is rarely cheap.

Though it is virtually never mentioned, expensive housing inhibits the ability to compete ‘globally’ (to coin a phrase).

And cheapness, not resilience has been government’s wish for the last decade.

Thus we are without significant vaccine manufacturing capacity.

In the US, Trump deflected anger and bitterness over stagnant wages, and precarious jobs caused by employers by scapegoating…. Even before his recent, overtly fascist, authoritarian outbreak he set out to punish poor immigrants – as well as China.

Yet in fact China’s economy nonetheless seems to keep outperforming the US.

Both seem to be outperforming that of the UK…

In fact when money is how the state gets stuff done, money is important but nowhere near as essential as the resources – natural and human – that it sets in motion.

Yet when money is supposed to be important in itself – and thus mistakenly presumed to be in short supply, best price is everything.

This seems to read across to public businesses and spending – even when it is obvious that that same public creates the money in the first place.

The Chancellor thinks the private sector is vital to a recovery but his supposed intelligence completely misses that according to the Federation of Small Business (FSB) a quarter of a million small businesses may well disappear.

Small and Medium Entereprises – substantial numbers of whom are within the FSB membership, provide the majority of jobs in the country. And that’s before anyone mentions Brexit.

Cheap and nasty is a frequent phrase – and I fear it has more meaning than we actually knew.

It describes the UK government.

Comments

  1. Andrew -

    “China’s economy nonetheless seems to keep outperforming the US”

    China is going to have an interesting time in the next few decades, demographically, as the population ages: the number of people of prime working age will be declining, but the number of older people will increase substantially. To put it another way, exponential growth cannot continue forever.

    1. Peter May -

      Agreed.
      But if you were looking at a business model, unless you’re Bezos,China looks to me to be slightly better than the disaster capitalism of the US. All the US has is freedom and when that freedom includes the right to bear arms the price, it seems to me, is quite high.

      1. B. Gray -

        Speaking of freedom in the U.S., it is ironic that many Republicans and conservatives are furious over private tech companies shutting down Trump and right wing outlets for inciting violence and insurrection as some egregious violation of their constitutional rights. Seems many members of the “party of the Constitution and capitalism” are ignorant as to how both of them actually work.

  2. Peter May -

    Quite so!

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