Social democracy: radicalise or its over…
Paul Mason
1.5K13

I did not start off disagreeing with your premise. But this transcribed shallow stump speech to the converted managed to un-convert me.

If I read you correctly your central evidence is a 70 year GWP chart showing flat growth over its 70 year span (35 years in the past and 35 projected into the future) as evidence that neo-liberalism is collapsing.

First, the last half of the chart is pure speculation. And given what poor forecasters economists are there is every reason to belive that this speculation is entirely wrong. But let’s say its not and move on to my next point.

Second, the average growth rate of your chart is 3%, which is very healthy and sustainable. Moreover after some early turbulence, the rate seems to settle into an even and comfortable pattern. Again, very healthy. So neo-liberalism seems to be doing very well.

Third, growth is the rate of change over time. If an economy grew last year at 4% but only 2% this year, that represents a -2% change in the growth rate. However the economy is still growing, just not as fast as last year. Showing negative growth rates can be very misleading, especially when the absolute values behind those rates are still increasing.

And fourth, as the economic pie grows, smaller percentages of growth actaully represent greater absolute values for more people (in other words, everyone’s life gets better). Let me explain…

Let’s say GWP at the beginning of your chart was $100 billion (only because I’m too lazy to search for real numbers). So at an averge rate of 3% GWP becomes $700 billion at the end.

So 1980's 4% growth rate represents $4 billion ($1 per person in the world) while 2050’s 2% rater represents $32 billion ($3 per person given population growth projections). In other words…Neo-liberalism tripled global per capita wealth.

I think you may have just convinced me that neo-liberalism is a good thing.

One clap, two clap, three clap, forty?

By clapping more or less, you can signal to us which stories really stand out.