Thursday, July 25, 2013

Is frivilous spending good for the economy?

Basically it comes down to how you define that vague concept of a 'good economy', if you define it as sheer material/monetary throughput in a particular day or month, then it is hard to argue that indiscriminate consumption isn't good for the "economy". But I tend to define a "good economy" as in terms of the health, happiness, and longevity of the people within that economy. And I think that politicians, advertisers, and economists (perhaps not economists), and the people who pay attention to them and are influenced by them, implicitly hold a definition of a "good economy" that is similar to my definition. When politicians (or whoever) promise to "stimulate" the economy, what they mean (or at least what I think most people take them to mean) is that they will cause people to produce more stuff and exchange more money and therefore quality of life will increase. If they only meant the first part without the second part, that is: "production will increase but quality of life will stay the same or decrease", then there would be no reason to elect them to office, follow their advice, or pay any attention to them because what they would essentially be saying is "I promise you will work harder but not be any happier." And there would be nothing "good" about that kind of an economy. So when people talk about "stimulating" the economy, I'm sure they do mean "causing people to produce more stuff and exchange more money," but there is a widespread assumption (a kind of cultural myth) that more production/consumption/money_exchange (regardless of what exactly is being produced and consumed) leads to a higher quality of life. But on examination, that assumption is revealed to be totally false, in fact it matters a great deal what is being produced/consumed, and how much time is being spent to produce it. In a truly "good" economy, we'd all work very few hours, enough to produce whatever food and technology we need to be happy and healthy, and spend the rest of our time doing whatever we enjoy, which I think for many people would not include making things or handing money around (there is a counter argument that could be made here, contending that excess leisure time would mean wasted potential, i.e. that people could be spending their time improving medical technology etc. instead of just taking it easy, but that argument would still have to agree with the main point I'm making here, which is that producing and consuming "frivolous" consumer goods is bad for everyone). To determine whether a particular product or service is frivolous, you only have to ask yourself one question "would I be any less happy/healthy/long-lived if I had just given that person my money in exchange for nothing rather than in exchange for whatever they had to spend time producing?" In light of the above discussion, it can be seen that the other person would be better off had they not had to waste their time producing stuff for you, so if you would be not be proportionately worse off without the item, then you have just spent frivolously and not helped anyone at all (notably, nearly all government military spending falls into this category, but that's another discussion entirely...), not even the economy.

(as is probably obvious from the style here, this was written for the purpose of arguing with someone on Facebook, not as an essay for a class like the previous four posts)

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