Achieving a sustainable world economy would be nothing less than a great step in human evolution, comparable with the mastery of fire or the development of settled agriculture as opposed to hunting and gathering. It concerns the whole world and needs to be tackled on a world, not just a national, basis. … Read more
A new definition of costs is also required. The term at present is muddled and confused in general usage.
Wealth loss versus Throughput Reduction
Any outlay of money in a national economy is regarded as a “cost” to the nation in the sense of some loss of wealth. … Read more
A subtle, indirect but nevertheless important further way in which environmental depletion damages economic health is through the extinction of species.
A particular species may not be throughput directly in the sense that a particular economic activity is based directly on that species. … Read more
Before and during the Great Depression there was under-consumption due to chronic under-payment of workers – fewer goods and services were being consumed than available workers and plant could structure. But what of the stagflationary situation, when chronic overpayment of workers was the distortion affecting more perfluent economies? … Read more
The term solar energy means not only the direct radiant energy of the sun, but also its stored forms – plants, animals, fossil fuels.
The sun’s radiant energy is not a resource, but the result of throughput of a resource – that being the sun’s matter. … Read more
This digression takes another journey over ground traversed in the post “Digression – Resource Consumption, jobs, and ‘Hands Off’ ” and in the Foreword.
In the foregoing discussion of pensions there appears to be a contradiction – the current trend of pension payments threatens severe economic dislocation, but such dislocation slows throughput and conserves wealth. … Read more
To back up the statement that the relationship of wages to prices is not linear, consider the case of an economy where there are no wages – where all the extraction of wealth, structuring and selling of goods and services is done by slave labour. … Read more
I was reading a popular news magazine last week and two stories followed each other directly. They described events in two neighbouring continents, North and South America. Yet they might have been describing events on two remotely separated planets.
The first story was about an Italian car-industry expert who has, in the past few years, restored the Chrysler motor company to profitability. … Read more
These increases or decreases, it must be emphasised, would be not necessarily absolute, but relative to what real wages would have been, depending on other variables, if the money wage change had not taken place. It is necessary to be reminded constantly that we are dealing with an array of interdependent dynamic variables. … Read more
To repeat in another way a point discussed earlier, there is an achievable optimum flow of money through the aggregate income (wages plus social welfare) channel in relation to the flow through other channels. The optimum state is characterised in two ways: (i) full employment, that is no involuntary employment of able people, prevails; (ii) economic activity, the wealth throughput rate, is at the maximum possible within the constraints imposed by other factors. … Read more