Gdp

[The Vegan Marxist]

Many pro-capitalists tend to always find themselves using the GDP argument when put to a corner on how Socialism benefits the people more so than capitalism does. The way I've always seen it, GDP doesn't entail whether or not people are able to acquire their basic needs, & I've pretty much just left it at that. Though, I'd like to know a better way of understanding this flawed argument & how to counteract to it a bit better. Any takers?

[mykittyhasaboner]

Technically, if some foregin company buys up a lot of property in, lets say Indonesia, and creates some kind of sweatshop factories to make shoes or belts or something, the GDP will go up because industry adds to the value of "all goods and services in an economy".

It doesn't mean that those workers aren't paid shit and live in horrible conditions.

Moreover, GDP is just an aggregate summation of value in an economy. How much of this value is going towards social services and things which actually benefit people, is completely unknown to the GDP.

[Armchair War Criminal]

If you don't understand the argument, how do you know it's flawed?

Over its life-cycle the state socialist economies grew, in strict GDP terms, at the world average - that is, about as well as the capitalist countries. They grew more slowly than the core capitalist countries, but more quickly than the capitalist periphery, whom they more closely resembled in starting conditions. So GDP doesn't tell us a lot about the relative merits of planned vs. market-based economies, although it may tell us quite a bit about internal differentiations within them.

[The Vegan Marxist]

If you don't understand the argument, how do you know it's flawed?


Because I know at least that it doesn't entail whether or not workers are gaining benefits from said GDP. Yet, pro-capitalists tend to use this argument either way, which, to me, is flawed.

[WeAreReborn]

It doesn't take into account that paper money is worthless and that people are still starving and dieing because of it in the "richest country in the world." Not sure what wealth is good for if people starve, maybe their metaphysics can explain it to me...

[sunfarstar]

good post!we cantalk with IT!:rolleyes::rolleyes:

[FSL]

Because I know at least that it doesn't entail whether or not workers are gaining benefits from said GDP. Yet, pro-capitalists tend to use this argument either way, which, to me, is flawed.
GDP could be growing and workers' income could stagnate or even decrease. Also, GDP isn't a "perfect" way to measure output, nor the only one. Socialist economies used NMP which is quite different.
GDP includes things like drug trafficking or the arms industry, things that obviously improve no worker's life.




Over its life-cycle the state socialist economies grew, in strict GDP terms, at the world average - that is, about as well as the capitalist countries. They grew more slowly than the core capitalist countries, but more quickly than the capitalist periphery, whom they more closely resembled in starting conditions. So GDP doesn't tell us a lot about the relative merits of planned vs. market-based economies, although it may tell us quite a bit about internal differentiations within them.


Up until the 50s USSR grew at a much faster rate than the rest of the world. Most of the eastern european countries could maybe get one "decent" 5 year plan before reforms were enacted.
USSR's industrialization was faster than that of Germany or Japan (in both cases, especially Japan's, the state played a role in coordinating investments) and much faster than UK's industrialization where the market was mostly "free".

Even after that, these economies grew at a pretty much "acceptable or better" pace. The whole world was going through a crisis in the 70s (stagflation, oil prices etc). Only in the 80s did USSR's economy really started lagging behind.


One might say that the US had a larger GDP per capita when compared to the Soviet Union and attribute that to the supposed advantage of a market economy.
The truth is that in 1990 (with its economy in recession) USSR's GDP per capita was more than 40% of what the US' was, 9000$ against 21000$. It had even surpassed 50% of it in the early 80s.


In 1914 however Russia's per capita income was 41$ and US' 377$ (Look near the bottom of the link given). A bit higher than 10%.
After that, Russian had nearly 10 years of constant war, while the US faced nothing like that.
So in the period between the 20s and the 80s, the average Russian went from earning 1/10 of what an American did to 1/2. And that's not taking into account the larger inequality in Czarist Russia and the capitalist USA.

http://www.digitalhistory.uh.edu/historyonline/us32.cfm


So instead of keeping that Russian guy poor in comparison to his American counterpart, Soviet Union's centrally-planned economy allowed him to become wealthier much much faster.

[bailey_187]

It doesn't take into account that paper money is worthless and that people are still starving and dieing because of it in the "richest country in the world." Not sure what wealth is good for if people starve, maybe their metaphysics can explain it to me...

GDP isnt a measure of the amount of paper value in an economy. Its a measure of output.

GDP has some flaws, for example, a rise in car accidents will lead to GDP increasing due to increased 'output' by mechanics fixing cars. However, these are not that significant. GDP is better than many other measures e.g. 'The Happiness Index' or whatever crap.

There is nothing 'radical' about being against using GDP. Or else Sarokzy, a Bourgeois president, would not be attacking its use.

[Queercommie Girl]

I wouldn't completely rule out the "happiness index" as long as it's measured reasonably objectively, especially in the context of asking workers how they feel about their working conditions and life in general.

Socialism must offer better working conditions for workers.

[Armchair War Criminal]

I wouldn't completely rule out the "happiness index" as long as it's measured reasonably objectively, especially in the context of asking workers how they feel about their working conditions and life in general.
Could you operationalize "objectively" here?

[Queercommie Girl]

Could you operationalize "objectively" here?

I'm not saying it's easy to do in a mathematical and quantitative manner, but clearly for a socialist it is highly important to ask the workers directly how they themselves feel about their working conditions. One problem with mainstream bourgeois economics is that it is non-humanistic, it does not concern itself with the workers as actual human beings, but merely as abstract economical producers and agents. So as long as "abstract productivity" increases, it doesn't matter for the capitalist boss that this is done through the death of workers from literal over-work.

[Dean]

Many pro-capitalists tend to always find themselves using the GDP argument when put to a corner on how Socialism benefits the people more so than capitalism does. The way I've always seen it, GDP doesn't entail whether or not people are able to acquire their basic needs, & I've pretty much just left it at that. Though, I'd like to know a better way of understanding this flawed argument & how to counteract to it a bit better. Any takers?
GDP is overstated: http://www.shadowstats.com/alternate_data/gross-domestic-product-charts

GDP Doesn't claim to account for standard of living, nor does it intend to. It simply accounts for the gross market value of products from a given nation / region. For the various reasons I've discussed in the past (search: "capital flight") it is expected that GDP will be generally lower in socialist states. This is due to the profit motive and incentivization to move assets and capital to nations which demand fewer social responsibilities for corporations.

[Dean]

GDP is overstated: http://www.shadowstats.com/alternate_data/gross-domestic-product-charts

GDP Doesn't claim to account for standard of living, nor does it intend to. It simply accounts for the gross market value of products from a given nation / region. For the various reasons I've discussed in the past (search: "capital flight") it is expected that GDP will be generally lower in socialist states. This is due to the profit motive and incentivization to move assets and capital to nations which demand fewer social responsibilities for corporations.


Here is my original point on the issue:


Actually, any equitable shift in the distribution of wealth will always cause a locality to experience capital flight, since greater equality translates to decreased profits. Any reasonable capitalist enterprise will place its capital and financial investment wherever it provides for the best returns. Shifting production from capitalist (profit-oriented development) to social models will cause a very explicit reduction in the investment viability of the location. Since it is capitalist enterprises which control the means of production, their flight means less production for socialist economies.

In other words, socialist policies often fail in a capitalist economy because capitalism is still the overarching managerial system.

There are real reasons why things happen. Mystifying them as if they were a simple ideal case of "people will always choose X" only serves to discredit you, and implies that you aren't serious about understanding the economic reality of the systems we're discussing.

[bailey_187]

I'm not saying it's easy to do in a mathematical and quantitative manner, but clearly for a socialist it is highly important to ask the workers directly how they themselves feel about their working conditions. One problem with mainstream bourgeois economics is that it is non-humanistic, it does not concern itself with the workers as actual human beings, but merely as abstract economical producers and agents. So as long as "abstract productivity" increases, it doesn't matter for the capitalist boss that this is done through the death of workers from literal over-work.

If GDP is a measure of output, and assuming in socialism an increased output will benefit all, increased GDP should lead to more happiness, as people are able to enjoy more stuff, more services etc.

[DaringMehring]

Here's one example you can use:

A factory spews a bunch of toxic waste into the atmosphere. 500 people living nearby get sick and go to the hospital. The GDP goes up --- because 500 people bought additional medical services.

Endless parasitical financial manipulations increase GDP in the same way.

[WeAreReborn]

GDP isnt a measure of the amount of paper value in an economy. Its a measure of output.

GDP has some flaws, for example, a rise in car accidents will lead to GDP increasing due to increased 'output' by mechanics fixing cars. However, these are not that significant. GDP is better than many other measures e.g. 'The Happiness Index' or whatever crap.

There is nothing 'radical' about being against using GDP. Or else Sarokzy, a Bourgeois president, would not be attacking its use.
I guess I wasn't clear enough, my fault not yours. What I meant is that the GDP measures output on what the CAPITALIST thinks the product is worth. He puts a value without taking into account all the product of labor. The value attached to the item is what I am rejecting not the item itself. If it was in the sheer amount of the product and not the value I might think differently.

[bailey_187]

I guess I wasn't clear enough, my fault not yours. What I meant is that the GDP measures output on what the CAPITALIST thinks the product is worth. He puts a value without taking into account all the product of labor. The value attached to the item is what I am rejecting not the item itself. If it was in the sheer amount of the product and not the value I might think differently.

errrr...

So you are suggesting the LTV does not operate in capitalism?:confused:

[WeAreReborn]

errrr...

So you are suggesting the LTV does not operate in capitalism?:confused:
It still fails to accurately represent the labour that went into it. It just represents the percentage to the "appraised" value which I'm sure doesn't take into account all the hours of each material and the actual time to create the house.

[Armchair War Criminal]

It still fails to accurately represent the labour that went into it. It just represents the percentage to the "appraised" value which I'm sure doesn't take into account all the hours of each material and the actual time to create the house.
Why not? Every hour spent creating the house, or producing the materials, is an hour that other capitalists are bidding on so that they can produce other commodities. Due to market fluctuations and the imperfect speeds at which capitalists adjust to them, exchange-value won't match up perfectly with value at any given time, but that's true for commodities generally.

[RedMaterialist]

GDP doesn't entail whether or not people are able to acquire their basic needs,



GDP is usually attacked by socialists for being an economic tool of capitalism. I think they are wrong. GDP statistics prove, in my opinion, many of Marx's arguments.

For instance, Marx (and the classical economists) said that the value, (money-price) of a commodity is determined before it enters into circulation or exchange. The vulgar economists, as Marx called them (for instance, Bernanke and Greenspan), claim that value and prices are only determined after commodities enter a market. GDP statistics are based on the idea that the price of a commodity can be determined while it is still in the hands of a manufacturer. They (the Bureau of Economic Analysis) actually call selected companies and ask them what the value of their inventory is. That, then, determines GDP, in major part.

Marx's most famous theory is surplus-value. GDP statistics show that the amount produced by the average worker, during, for instance, a year, is more than the amount paid.. Thus, surplus-value is proved.