A metaphor for the economy

Having been reading Fred Clark's blog at the Slacktivist for some time, I've been very struck by his argument that it is not only possible for us to do something about the stagnation of economies, it's actually a moral duty.

Now, Fred approaches his moral decision-making from a Christian, Baptist, evangelical viewpoint. In fact, he is the one man solely responsible for salvaging 'evangelical' as anything other than a term of abuse in my lexicon. However, one of the things I respect most about him, is that he bases most of his reasoning on good secular reasoning that is accessible to all of us, whatever our faith (or lack of it).

Now, while Fred is very USA-centric, a lot of his arguments apply to the UK as well. However, it's all too easy to do a down-home, folksy argument about household budgets. For instance, this. So, I want to find a way to put in terms that bring it home.

So, we have Sam Smith. Samuel? Samantha? Who knows. All we know is, that Sam is an electrician. As an electrician, Sam does emergency repairs, upgrades, major remodelling of internal wiring, Portable Appliance Testing, the works. So in the recession, Sam's income has dropped quite sharply. People still need emergency repairs, and PAT is a legal requirement, but the upgrades and remodelling has dropped off a lot, as has new construction.

So Sam, who used to be on £40,000 a year, has dropped to £25,000. Times are tough, and Sam's savings have disappeared to cushion the blow and cover current expenses. The mortgage is still there, demanding paying.
And now, as one blow on another, Sam's van is breaking down. It's been everywhere, carrying Sam's tools all over the place from one job to the next. It probably won't last much longer.
So Sam has a big decision to make: take a small loan to fix up the van for a little while; take a large loan to buy a new van; or wait for the van to break and then only take jobs in walking distance; which will, incidentally, drop Sam's earnings to more like £12,000 a year.

Bring it back to the macro scale of the entire economy. Yes, we have a lot of debt; paying it off takes money. At the moment, we are not stuck for ability to borrow more money; and cutting government spending GIVES US LESS MONEY TO PAY OFF OUR DEBT.

Sorry about the shouting, but it's true.

Time to reconsider spending cuts, maybe? Yeah.

Keynes was right. He remains right. The fact that we failed to control spending and build a cushion of budget surplus when times are good, does not make cutting the way to escape a recession.


Tottenham background:

As riots have kicked off in London, the default opinion seems to be "Crush the animals".

It's hard to do or say anything that looks like condoning the explosion of violence, now spreading to Liverpool, Birmingham, Bristol and beyond, which has claimed lives, brought severe injuries, and caused many millions of pounds in damage.

However, I'm aware that however much we might like to think so, other people are not animals; nor are they mindless. So that tells me that there are thousands of people around this country who are so lost, or so disaffected, or something, that they see rioting and looting as a better option than whatever else they'd be doing. So we should expect the rioting areas to have worse numbers on a range of measures, including but not limited to:

5 A*-C grades at GCSE as a measure of education
Crime rates
And also number of young people (15-24, say) as a percentage of population.

So let's see what we get for Tottenham.

Unemployment rate at 10% amongst 18-24 year olds. This is purely for those on Job Seekers Allowance; those on other benefits such as Incapacity may well be functionally unemployed but aren't counted in these figures. For the area overall at all ages, the unemployment rate including other benefits is 17.0%. Based on a newspaper report in a local paper from July, Tottenham had 6,000 JSA claimants and 121 jobs at that point.

So if you're a resident of Tottenham you have a 17% chance of being unemployed. If you are part of that 17% and actively job hunting, you have [all else being equal] a 2% chance of getting any job you apply for.

Now let's add in the education aspect. According to league tables, 41% of Tottenham pupils get 5 A*-C GCSEs. So a substantial majority are functionally unqualified. Even if they are actively jobseeking, there will be many applicants for every job, so little hope of even a dead-end, part-time job to supplement their benefits, let alone actually live off.

Now let us add in the fact that the local council, under pressure from central government, have made 75% cuts to their youth services budget, including closing most of the youth centres in the area.

Oh, and a final bonus, the crime rates in the local area range from slightly above to nearly double the national average.

Looting is never a productive or useful option. Rioting rarely is; I don't think this is one of those rare occasions. And people have died.
But see it from the perspective of a young person in Tottenham, for a moment: what else do you have to do? And what, exactly, have you got to lose?


As contributed to a forthcoming Atheism 101 on the Slacktiverse:

Billions of years passed before my birth; billions of years will pass after my death; and I could
easily not have been born at all.
Does this make my life meaningless or worthless? No, no more than it is not worth going to see a
play because it will end. My life is contingent, not required as part of the course of the universe, but
that makes my very existence a most wonderful opportunity..
I used to call myself a Christian, because my parents are, and it was part of the cultural backdrop
(Anglican Church specifically). I'm not sure I ever believed it, though I have always rather enjoyed
some of the hymns. However, it wasn't until I was about 13 that I began seriously asking myself
whether or not I believed, and the immediate trigger was my parents asking whether I wanted to
be confirmed. The more I thought about it, and the more questions I asked, the more I realised the
concept of God meant nothing to me. It quite literally does not compute. The way I'm wired, I don't
think it is possible for me to believe in God without seeing Zir personally, and even then my first
thought would be to doubt my sanity.
As such conventional Christianity is clearly a non-starter for me, but I did spend a while wondering
whether I could take much from this Jesus bloke. And I...wasn't especially impressed. The Golden
Rule, while nice, had been stated earlier. Love thy neighbour is a useful principle, but again hardly
earth-shattering. And there remained teachings about slavery and the place of women that made me
deeply uncomfortable.
So that left me with a need to explore and discover what my principles and values where, and what
they were based on. And here, a couple of Christians were very helpful, along with another atheist.
In rambling, long-running conversations in the school library we sometimes explored, sometimes
railed against each others' ideas. Over several years we each founded our thinking much more
firmly as the weak foundations were struck away. We never reached agreement, and that taught
me one more lesson I needed - that intelligent, educated, well-meaning people can fundamentally
Some of the things I was told horrified me; such as R's assertion that zie would do anything God
demanded; anything at all, no matter how immoral; or when J said that God had commanded his
people to destroy the Canaanites. And this was the thing which brought me to realise that a rigid
moral code based on a revelation was, bluntly, dangerous. I am and remain wary of individuals who
will put principles before people, be those principles Christian, communist, neo-liberal or any other.
My life is my own. I try to do right because it is right, not because it is written. And my greatest
hope is to pass to my children a better world than I was born into, in some small way.