Great piece! I think this is especially relevant given a Trump admin official — Kevin Hassett, I believe — made a claim in a Fox News interview that a 4.3% growth in GDP means we’re all earning 4.3% more.
Obviously, as you state, GDP isn’t a measure of how income is distributed. There is much work to be done on the poverty front.
My favorite measure of economic well-being is the "IHDI" -- Income-adjusted Human Development Index. It's not perfect, but it's possible to apply globally, it relies on real measurable factors, and it adheres to the test of "reasonably good comparisons". I don't shout it from the mountaintop, but I do assign it for the Project for my Macro students. https://en.wikipedia.org/wiki/List_of_countries_by_inequality-adjusted_Human_Development_Index
Poverty is endemic in current economies, which are based on private ownership of the means of production (Capitalism). One way to solve this problem is Social Democracy, as practiced in Sweden and some other European economies -- taxing incomes -- especially high incomes -- to fund social services for those who earn little or nothing. The United States initiated a Social Democratic economy under President Franklin Roosevelt in the 30s, and later expanded it under Presidents Kennedy and especially Johnson, who created the Great Society programs, as well as George W. Bush's Part B Medicare and President Obama's expansion of Medicaid.
There have been other, transformational economic reforms proposed. One is Universal Basic Income, which is a set regular income for all citizens, variously funded by income taxes, by a tax on resources (Alaska's Permanent Fund, Norway's Government Pension Fund Global), or by creating money ex nihilo (Stephanie Kelton's Modern Monetary Theory). In the late 19th century, the journalist Henry George proposed funding government by taxing the underlying natural resource value of land -- he considered that this was the common heritage of the nation, inasmuch as he considered that only products created by human labor should be "owned" by the creators. In the early 20th century the Scottish engineer C.H. Douglas created Social Credit Theory, which proposed, in effect, diverting the value of the intellectual property as a proportion of the production of machinery and equipment whose patents had lapsed, to fund a "social credit" to be distributed to the population, on the assumption that this was the common heritage of the citizenry.
A common thread in these schemes is the idea of the Labor Theory of Value, which was developed by Adam Smith, but especially by David Ricardo, most famously (with a strong moral edge) by Karl Marx, but also by John Locke, who was then criticized by Pierre-Joseph Proudhon for allowing land "owned" by virtue of working it to be passed on by some magical process to one's heirs.
Great piece! I think this is especially relevant given a Trump admin official — Kevin Hassett, I believe — made a claim in a Fox News interview that a 4.3% growth in GDP means we’re all earning 4.3% more.
Obviously, as you state, GDP isn’t a measure of how income is distributed. There is much work to be done on the poverty front.
"Economic growth is not the same thing as economic well-being." This should be shouted from the mountain top!!!!
My favorite measure of economic well-being is the "IHDI" -- Income-adjusted Human Development Index. It's not perfect, but it's possible to apply globally, it relies on real measurable factors, and it adheres to the test of "reasonably good comparisons". I don't shout it from the mountaintop, but I do assign it for the Project for my Macro students. https://en.wikipedia.org/wiki/List_of_countries_by_inequality-adjusted_Human_Development_Index
Poverty is endemic in current economies, which are based on private ownership of the means of production (Capitalism). One way to solve this problem is Social Democracy, as practiced in Sweden and some other European economies -- taxing incomes -- especially high incomes -- to fund social services for those who earn little or nothing. The United States initiated a Social Democratic economy under President Franklin Roosevelt in the 30s, and later expanded it under Presidents Kennedy and especially Johnson, who created the Great Society programs, as well as George W. Bush's Part B Medicare and President Obama's expansion of Medicaid.
There have been other, transformational economic reforms proposed. One is Universal Basic Income, which is a set regular income for all citizens, variously funded by income taxes, by a tax on resources (Alaska's Permanent Fund, Norway's Government Pension Fund Global), or by creating money ex nihilo (Stephanie Kelton's Modern Monetary Theory). In the late 19th century, the journalist Henry George proposed funding government by taxing the underlying natural resource value of land -- he considered that this was the common heritage of the nation, inasmuch as he considered that only products created by human labor should be "owned" by the creators. In the early 20th century the Scottish engineer C.H. Douglas created Social Credit Theory, which proposed, in effect, diverting the value of the intellectual property as a proportion of the production of machinery and equipment whose patents had lapsed, to fund a "social credit" to be distributed to the population, on the assumption that this was the common heritage of the citizenry.
A common thread in these schemes is the idea of the Labor Theory of Value, which was developed by Adam Smith, but especially by David Ricardo, most famously (with a strong moral edge) by Karl Marx, but also by John Locke, who was then criticized by Pierre-Joseph Proudhon for allowing land "owned" by virtue of working it to be passed on by some magical process to one's heirs.
Here is a good overview of details of Social Credit Theory: https://www.socred.org/s-c-action/social-credit-views/the-economics-of-social-credit-in-summary/social-credit-explained-in-7-points