Goveconomics - Macroeconomic View
Macroeconomics is a major subdomain of Economics. It’s role in feeding government expansion is discussed.
Microeconomics Defined
I copied this definition (in italics) from the Investopedia website. My comments follow.
Macroeconomics is the study of the behaviour of the economy as a whole. This is different from microeconomics, which concentrates more on individuals and how they make economic decisions. While microeconomics looks at single factors that affect individual decisions, macroeconomics studies general economic factors.
Macroeconomics is very complicated. Many factors influence it. These factors are analyzed with various economic indicators that attempt to assess the overall health of the economy. The U.S. Bureau of Economic Analysis provides official American macroeconomic statistics.
Macroeconomic analysis broadly focuses on three things—national output (measured by gross domestic product), unemployment, and inflation. Macroeconomists try to forecast economic conditions to help consumers, firms, and governments make better decisions:
Consumers want to know how easy it will be to find work, how much it will cost to buy goods and services in the market, or how much it may cost to borrow money.
Businesses use macroeconomic analysis to determine whether expanding production will be welcomed by the market. Will consumers have enough money to buy the products, or will the products sit on shelves and collect dust?
Governments turn to macroeconomics when budgeting spending, creating taxes, deciding on interest rates, and making policy decisions.
MY COMMENTS.
If governments were competent in utilizing macroeconomic data and analytical tools to provide real value to me and our citizens, I would support them in the same way that I support non-government enterprises that have served me and my family well. I am a loyal customer to product or service providers who have EARNED my trust.
“TRUST is humanity’s most valuable asset”.
If you search the Internet for this quote, you will find that is a common claim made by various people in different contexts. If this claim is true, then why do so many politicians and public officials squander this asset so often and in such a cavalier fashion. Do they feel so secure in their position that their public trust (aka “political capital”) no longer holds any value for them?
The domains of public authority are intractable.
Unlike governments, the owners of private capital who run businesses focus on solving problems that can be solved. The history of capitalism has proven without any doubts that creativity, innovation and a focus on getting results will generate growing returns from satisfied customers.
Governments own the macroeconomic sector and its resources. They produce dubious results at best in spite of the fact that funding is guaranteed through tax revenues extracted from citizens who are likely not even aware of where the tax dollars go. Public trust in macroeconomic analysis is understandably hard to assess and quantify. Some discernible reasons include the following.
A. Complexity and Macroeconomic Analysis
Macroeconomic analysis suffers from the same weakness as weather and climate analysis - there are far too many variables to track and measure accurately. The best that it can offer is a hypothetical snapshot of what might occur in some future timeframe. How can these analyses accurately portray or predict the present or future state of such complex systems that are so infinitely dynamic? No matter how powerful our computer systems become, they will never come close to accurately and reliably predicting the future.
B. Official Statistics are government-generated
I don’t think that I am alone in distrusting government reports and claims. I question the competency of administrators to understand complex topics in sufficient depth to report credibly. I am suspicious of the incentives of public officials and politicians to report without injecting a partisan spin or a narrative that supports a political agenda.
Given the ‘complexity” topic discussed above, I consider it the height of hubris that our legislators and regulators can impose rules on humanity based of the “wish and a prayer” that their macroeconomic analyses will prove to be correct. Does is make any sense for any reasonable and intelligent person to believe that hundreds of thousands of rigid government rules should be applied to the choices and actions of hundreds of millions of citizens when so much uncertainty exists concerning our infinitely dynamic domestic and international economies and climates (natural and political?
C. “He who pays the piper calls the tune”.
The majority of research is funded by very wealthy organizations, private and public. Clinical trials for new drugs, for example, are funded by the same drug companies who stand to earn a return on the extensive investments required to bring new products to market. As such, it is in the best interests of their shareholders and board members to promote the benefits of their products while downplaying the risks in order to obtain the approvals of the regulatory agencies.
How many other corporations in other business sectors have been able to slip a new, unsafe product through the mesh of scrutiny for which the regulatory agencies are responsible?
Governments are the dominant sources of funding for research. Their investments are also expected to generate a return, but not in profits. Public support (or lack of opposition) pays off on votes - the only payoff that matters to politicians who wish to stay in office.
Governments are also the primary source of funds (subsidies and advertising contracts) for the declining corporate media industry. These enterprises have little option but to ‘sing the piper’s tune’ in their messaging to the voting public if the wish to maintain the “sustainability” of public funding.
Scraping the bottom of my barrel for scraps of trust.
I want to live in a society in which I can trust my fellow citizens. However, after a lifetime of disappointments from so many corners of society that have been captured by government, political and powerful special interests, very little trust remains.
I remember a time when I was a young man starting out in life. It didn’t occur to mr to question the trustworthiness of news broadcasters and our public institutions. After all, I had been a paperboy earn spending money and I had attended government schools and universities which taught me how to view society. My naïveté was understandable from those experiences and in the pre-Internet era when “diversity of opinion” was rarely challenged as a human right.
I was just 30 when the Charter of Rights and Freedoms was signed (April 1982) and had little appreciation for the significance of that document. Little did I know that it would become central to my views as a senior citizen. I now believe it’s content and enforcement to be essential for a free and civil society in 2022.
Who would have guessed and that it would take a nationwide Truckers for Freedom protesting peacefully against authoritarian pandemic mandates to wake me up to the importance of defending the Charter.
The Bully Pulpit seems unassailable
I now understand that the government owns the “bully pulpit” from which to command and control us. It’s control of the macroeconomics sector is just one more instrument of coercion to keep the voting majority of us have blind to their quest for more power. I wish I could end on a more optimistic note but, like trust, I not sure if I will find much optimism at the bottom of my barrel.
