Alright Pericles, you reckon that these two statements of mine are contradictory:

>> GDP... is a most terribly flawed economic indicator, which adds all sorts of negative factors to the positive side of the ledger, such as increased economic turnover as a result of fires, floods, cyclones, illnesses due to smoking or alcohol, etc, etc. <<

and

>> Fires, cyclones, illnesses, car accidents, droughts, obesity, and a thousand other bad things, have a negative effect on productivity. Of course as a result of these, GDP would be lower than it would otherwise be <<

Hmmmm….

Yep…

They are totally contradictory.

You win this argument.

I’m outta here.

Bye.

Ahhhh… you WISH!!

No they are not at all contradictory.

We have thoroughly been over this, so I’m only repeating myself here:

The economic activity that results from the recovery effort from fires, floods, cyclones, etc and from car accidents and smoking, alcohol and obesity-related illnesses etc does indeed get included in the GDP total. It all makes GDP bigger than it would otherwise be. And it certainly isn’t just activity that gets diverted from elsewhere, which you have finally conceded to be the case.

But of course none of this activity should be added to GDP, as it is all taking us from a negative position back to a neutral position. It is not advancing our economy. It is just getting us back on track. Or in the case of car accidents and illnesses, just ongoingly trying to counteract or reduce the magnitude of the negative economic impacts of those things.

So to my second statement:

Of course disasters, accidents and illnesses lower our economic productivity. GDP would be lower than it would otherwise be. But if GDP didn’t include economic activity undertaken as part of recovery efforts or ongoing combatant efforts against illnesses, it would be lower still… and would more accurately reflect the negative impacts of these things.

A lot of activity that registers positively with GDP is a direct result of negative impacts on our economy. This is just bonkers! ALL that sort of economic activity should be seen as neutral….as being outside of the parameters of the GDP calculation!

Yes it would be hard to sort out just what should or should not be included in this calculation. But I’m sure we could do it if we tried. We could certainly implement a much better economic indicator than what we’ve currently got. It wouldn’t be perfect, but it would still be about a thousand times better than the GDP indicator as currently defined.

So I hope now Pericles that you can see that there is no contradiction between these two statements.

You still don't get it, do you Ludwig.

>>The economic activity that results from the recovery effort from fires, floods, cyclones, etc and from car accidents and smoking, alcohol and obesity-related illnesses etc does indeed get included in the GDP total.<<

Yes, it does.

>>It all makes GDP bigger than it would otherwise be.<<

Not necessarily. It depends whether additional money is injected into the economy in order to combat the problem. If it isn't, then the economy does not increase in size, and is therefore not "bigger than it would otherwise be". In fact, it would become smaller, as unproductive activity within the economy increased in relation to the productive part.

>>But of course none of this activity should be added to GDP<<

It isn't added. It is included.

>>Yes it would be hard to sort out just what should or should not be included in this calculation. But I’m sure we could do it if we tried.<<

But it would not make sense to anyone except you.

pre-ridicules..<<..smoking, alcohol and obesity-related illnesses etc does indeed get included in the GDP total.<<

Yes, it does.>>

no it dont..its economic activity..does.
i home brew..i home grow..i home heal..there is no economic benifit/from me..

>>It all makes GDP bigger than it would otherwise be.<<
[no im not spening a cent/if i was to double my smoking..it dont showup/in extra sales..fertiliser/water..are minute..but if i use chook poo/rain water..nix nadda

<<Not necessarily..[bigger..gdp..'..It depends whether additional money is injected into the economy in order to combat the problem.>>

how come suddenly its a problem[no extra money was expendid[thus there is no problem/govt spendinf a bigger precentage/of nuthin.

<<If it isn't,..then the economy..does not increase in size,>>

sure/but what about barter?

no increase..<<..and is therefore not "bigger..than it would otherwise be".>>

that grates/on me..ok i got my crop/if disaster breaks..instead of free/i need raise the money or the value/in barter[its new eco activity]

more not less..<<....In fact,..it would become smaller,
as unproductive activity>>
[that seems the root of the error..
the disaster..isnt non productive..in fact not only me bying my booze/smokes..but insurance/buying roofs buildig etc[not imediate/but progressive/with a peak/then a low[and if thats not done..no eco activity/though some will rebuild by barter]

the real question/is\..has eco activity increased..
or are the volenteers suckking otherwise paid work?

<<..within the economy increased..in relation to the productive part.>>

>>But of course none of this activity should be added to GDP<<

It isn't added. It is included.>>

freaking same same
im including the tax burdens on you..but every penny you 'spend'..is added to gdp/but as expenmditure is linked to it..its govts aid/to beat any/of it up..

but only..so they can spend more

see how it should go/is money suply links to asset
as assets increase[via deflation]..the money supply..to govt
is increased../by way of\..'other consuming taxes...'anyhow govt should revenue raise by money moving..wether its moved for ever..or a micro second/a transaction/tax..on all transactions/double for corpertions/inc's/ltd's..and trust's tax minimisation..or money-export.

Nope. Wrong.

>>It isn't added. It is included.>>
freaking same same<<

That is the persistent error in Ludwig's logic.

There are ten people in a room.

If John walks in to join the people in the room, he is added to the total, making eleven in all.

If John is included in the people in the room, there are still only ten.

Most people learn this simple concept when they are in their first year at school. But perhaps that was so long ago for you and Ludwig that you have forgotten.

Is there another aspect to this misunderstanding, Ludwig?

"Of course disasters, accidents and illnesses lower our economic productivity. GDP would be lower than it would otherwise be."

You do understand the difference don't you, and that economic productivity is not economic product?

As near as I can figure it you do not want GDP to be what it is defined as, but to be something it is not defined as.

Wouldn't it be easier to argue for a Net Domestic Product? Though "it would be hard to sort out just what should or should not be included in this calculation."

On which side of the accounts would the time and costs of posting comments online appear, for example?