And if he can pay workers with potatoes and chickens, thats fine. But if he needs a new tractor imported from america, will they accept a barnfull of wheat in exchange? I agree about this, and so do economists. In 2007 there were various factories making goods. These factories still exist but a good number are now only making half as much. I am sure people still want the goods they used to make, but somehow they can no longer afford them. What happened? This change has to do with 'confidence', because if I spend, then you get the money, then you spend it with jason. then he pays drifter for something..and so on. If anyone stops paying, then no one gets what they want. It also has to do with debt. Debt which has been run up and now has to be repaid, and that at the start of this chain we had learnt to rely on borrowing the money. This has stopped. Sure, in theory the whole system can adjust so that everyone gets less pay for doing what they were doing before, but this is a very difficult thing to do quickly.
My point being that magically, we were able to survive without tractors and modern conveniences in the past. If he needs a new tractor but can't procure one, he'd find a substitute. Something less efficient? No doubt about it! Producing less? Sure. But the best inventions usually come in times of dire need, not when things are running smoothly. :smile:
Ferguson would say....(I guess), yes, but not effectively. The institutions, banks, law, stock exchange, allow people to amass money and guarantee its safety when you invest it. So much more convenient than a barn full of turnips if you want to buy something or start up a computer software business. What he argued is that it was these institutions which allowed the step change upwards in wealth creation.
Again, I am not arguing with the premise that things are more efficient with the current system (when it works as theoretically intended). But human technological/economic/whatever progress did not magically begin day 1 of the first bank. There was progress leading up to it. A different set of global circumstances would have brought progress in a different form. That's how evolution works - life responds to environmental pressures. And I'm sure if we got a lot of smart and creative artists, engineers, philosophers, and saints together in a room, we could come up with a new economic system with new channels for distributing capital.
I was curious where you were from....good to have views from different places. But do you reckon life is better there with a non-functional currency? (or do people use other currency like dollars, rand? )
Heritage is Zimbabwean, but I have called various countries home in my short time on this planet. Birth country and place of longest stay is the US. But yes, in Zimbabwe people of means will generally use pounds, euros, us dollars or rand. But you have to understand, there, the issue isn't the currency, its the fact that the people who have the most intelligence have said "fuck it, I'd rather move to the UK, Aussie, South Africa, Canada, Europe, or the US than deal with this shit." The intelligent people who have stayed are in on the self-destructive exploitation.
Ferguson started the lecture with some statistics about how the west had initially lept ahead in economic terms but was now falling back. I dont necessarily think economic stagnation is so very bad when you have already reached a very high standard of living, but what he is saying is we have completely undermined the structures which created the wealth we enjoyed. I doubt many people in the UK fancy digging up their gardens to grow food or getting paid in cabbages. This would be the doomesday scenario.
Like I said, doomsday is dramatic. Being Zimbabwean, I have seen probably the best example of economic mismanagement on the planet right now. But it's all about standards and one's personal hardiness. Yes, I have a high salary IT job and live in comfort in the US. But if I had to go back to rural farm conditions, I'd do it and get on with things. The hysteria here, I feel, is due more to a fear of having to work harder day to day for basic necessities. In any case, any system has a life expectancy and shouldn't be thought of as a permanent fix because, as I said earlier, environmental pressures change all the time and living things will evolve accordingly or die.
Yes indeed, but the consensus in Europe is that a collapse as you describe and then 50 years to return to the current standard of living is not an acceptable solution to the current crisis. You will have noticed jason describing how horrific the situation is in Greece and we are nowhere near what you describe yet.
It sounds to me like Europeans at large are finally starting to internalize the shittiness of the quality of life in many parts of the world that is a direct result of the system that has created their high standard of living. Greece is at the tip of the iceberg in terms of how bad societal breakdown can get (civil war, food riots, government murdering citizens en masse to maintain order, etc). As a person who has witnessed the worst of Third World poverty in places like India, Thailand, South Africa, Haiti and Zimbabwe, I have very little sympathy.
Further, the consensus in Europe has also been for the state to finance social welfare at a level that is financially unsustainable. All I'm saying is that sometimes there is a gap between the lives that people want and the resources available to make it happen. In any case, Ferguson's argument seems to be that standard for the majority is declining anyway - if so, destructive change is inevitable. Call it a market correction.:smile: