Monday, September 21, 2020

Bill Mitchell — There is no inevitable trade-off between saving the lives of the aged and economic prosperity

Many issues that become ‘hot topics’ in public debates are really non-questions despite the heat they raise. All sorts of experts advance views, television current affairs programs trawl over them with various of these experts making careers for themselves, politicians take up hours of their time and our time discussing them, yet, when you really break the issue down – there is nothing much to see. The seemingly very erudite debates, discussions, opinions are all based on false starting premises, which are assumed and rarely discussed. This sort of charade is all the legacy of living in the fictional world created by my profession, which has distorted public discourse so badly that we now have people saying old people should be allowed to die terrible deaths from COVID so the young people can have jobs. These are old people who worked all their lives to help build our nations, who fought in World Wars to defend our freedom from daunting enemies, old people who cared for us personally, and old people who mostly, probably, have the joy of life before them each day they open their eyes, just like any of us. The problem is that the whole construction is based on a false premise: being that there has to be widespread economic damage if we choose to protect the health of our peoples. That premise is based on the failure to understand that the currency-issuing government can attenuate any economic losses if it chooses to adopt appropriate economic policy interventions. The fact that real GDP and employment has fallen significantly this year is testament to a failure to use fiscal capacity. We should be better informed before we get into elaborate but flawed debates that essentially come down to turning one population cohort against another.
Good on Bill. 

This is somewhat similar to the faux concern over "exporting jobs" to less developed countries when the real terms of trade are in favor of the nations importing goods and exporting the job that uses to make them domestically. This is actually beneficial for both countries, since the country exporting goods gets investment for development and the country net importing gets real stuff. But it only works if the country exporting jobs replaces them with job of at least comparable quality by intelligently targeted fiscal policy.

Bill Mitchell – billy blog
There is no inevitable trade-off between saving the lives of the aged and economic prosperity
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

1 comment:

Peter Pan said...

Biased old geezer Bill should note that deaths to Covid among the elderly are due to incompetence. The economy took a hit, yet there was widespread failure to protect vulnerable groups. Bad health policy + neglect of palliative care.