<< Oh, Ludwig, Ludwig. What an embarrassing rant. >>

Oow, sorry to embarrass you Pericles, old mate!

Actually, I think you have embarrassed yourself considerably more with your amazing response.

So ‘real’ GDP is simply GDP that is inflation-adjusted. Well how about that!

So does that make it a more meaningful indicator of our national wellbeing?

Erm… no. GDP is so critically flawed that presenting it in an inflation-adjusted manner is akin to a presenting a wolf in goat’s clothing rather than sheep’s.

I wrote:

>> GDP includes all sorts of things which really should NOT come out on the positive side of the ledger… <<

You wrote:

<< What a crock >>

And then:

<< Illnesses create work for nurses and doctors… >>

and

<< Floods and earthquakes siphon money back out of the insurance companies… >>

In other words, what I was saying is not a crock at all! You AGREE that bad things are counted as a positive part of GDP!

So by your reasoning, if we had more illness and more natural disasters, we’d have a bigger GDP, all else being equal, which would indicate a better outlook for our economy and national wellbeing!!

Crikey Pericles, you’d have to be embarrassed about that faux pas!!

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Pericles, going by the same sort of reasoning, you would be all for rapid population growth, because it would generate a great deal of economic activity, end of story. You wouldn’t even consider the downsides that this sort of growth has for our environment, resource base, infrastructure and services, or the fact that the vast majority of that economic activity is self-serving for the new residents and of very little use to the pre-existing population.

Also, you apparently completely don’t grasp the concept of balancing supply and demand and think that it is not only ok to have an ever-increasing demand for everything, but that it is essential for economic growth…. and that economic growth is essential for a decent national future.

That is simply amazing!!

We surely MUST head towards stabilising demand. As the demand slows, we will be able to function with a lower rate of economic growth. And then we will reach a point, some time after the demand stops growing, where we will be able to provide all our needs and maintain a high quality of life without a growing economy.

Surely you can appreciate that the demand cannot keep growing forever. Likewise with the economy. So please, get your headspace around the absolute imperative for us to strive for a stable population and a stable non-growing economy….. and STOP worshipping this insane notion that we have to have continuous economic growth, forever more.

Farmers know about growth needing to be productive, if it's not they quickly pull it out of the ground.

'Experts' however seem to come up with high speed train 'visions' with no export product ability between cities 1,000km apart, where airlines and buses already operate.

In contrast, a northern Qld Gregory Range wet season water harvesting system with aqueduct south to the upper Darling River catchment to water new and existing food and fibre local and export production en route, should be in focus.

How to get the blinkers off and overcome the apathy and jealousy seems the difficult task to get some talk happening.

In other words, how to get government interested in productivity and growth involving the Gregory Range Qld?

Scroll down here to, The Climate.
http://www.rgsq.org.au/19-143c
Quote, "The greatest rainfall recorded in a year was 2 045.7 mm in 1974, and the least was 308.4 mm in 1926."

You are joking, of course, Ludwig.

>>Oow, sorry to embarrass you Pericles, old mate!<<

I wasn't the one embarrassed, Ludwig, it was your rant, not mine.

>>So by your reasoning, if we had more illness and more natural disasters, we’d have a bigger GDP<<

Don't be silly. If we had twenty million nurses tending a single patient, there would not be sufficient money to pay their salaries, would there? I'm amazed that you would even imagine that is my "reasoning", unless you were deliberately setting out to be insulting.

Which is not out of the question, of course, but I'd like to imagine that you are above that sort of thing.

The point is, though, that if there was only enough money from (say) mining to pay for their employees' food and lodging, then the economy would be worth $x. If however there is enough excess generated (lets call that $y) to pay for doctors and nurses, GDP would be ($x+$y). And if there was even greater surplus generated, enough ($z) to pay for a holiday in Cairns, then GDP would be ($x+$y+$z). So the economic activity that keeps doctors, nurses, hotel receptionists etc. in employment needs to be taken into consideration.

You may ask, why then do we not just count the money generated from mining? And the answer would be yes, we could do that. But it wouldn't tell us much about the prosperity of the nation as a whole, just the profitability of Gina Rinehart.

Are you with me?

And you are right that GDP only measures economic activity. The reason for that is because, well... that's what it is designed to do. If you want a Happiness Index like Bhutan has, then by all means invent one.

>>Also, you apparently completely don’t grasp the concept of balancing supply and demand...<<

Actually, I do. We have significant spare capacity for growth in our economy, with low interest, low unemployment and low inflation. I don't see the need to throttle growth just yet awhile.

<< We have significant spare capacity for growth in our economy, with low interest, low unemployment and low inflation. I don't see the need to throttle growth just yet awhile. >>

Interesting statement Pericles.

Firstly, you are not separating the good and bad growth. This is a fundamental flaw that just about all analysts and commentators on this enormous subject have.

There is the good part – which should lead to bigger average profits, better services and infrastructure, high employment rates, etc, etc…

And then there’s the bad part, which forever increases the demand for more economic turnover, more services and infrastructure, and the creation of ever-more jobs in order to just maintain the same unemployment rate.

Of course, this bad part is population growth... which just completely works against the good part!!

So, if you are using the term ‘growth’ to include both good and bad growth, which I’m sure you are, just as practically everyone else does, then…..

NO! We do NOT have much ‘spare capacity’ for growth at all!

Look at water supplies, and congestion, and at all manner of other indicators, that are telling us that enough is enough!

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