Found the standard of living index that someone mentioned before:
What it is is just consumption plus government minus military: This
means that when military spending goes up, Standards of living go
down, and when investment goes up, standards of living go down.
When taxes go up, standards of living go up, and when the deficit
grows larger, standards of living go up. (Resources are transferred
from the Capital market (K) to Government debt (G). Now, according
to Richard, the Japanese corporatocracy is the model worthy of
emulation. Let's compare the numbers for standard of living for
Japan and, oh, let's say, the U.S. Remember that absolute numbers
don't mean anything to this measure -- Rather, it shows which
sectors of the economy are being stimulated at any given time. It
does not tell you whether the pie is growing or not, just who is
getting what proportion of each slice of the pie. Remember, Japan
spends almost nothing on its military as a % of GDP, so the Japanese
living standards should be much higher than the U.S. ----
For Japan:
1970 63.8
1971 64.8
1972 64.9
1973 65.1
1974 66.0
1975 67.8
1976 67.2
1977 66.8
1978 67.0
1979 67.2
1980 66.1
1981 65.2
1982 66.0
1983 66.7
1984 65.6
1985 64.5
1986 65.0
1987 64.5
1988 63.3
1989 62.5
For the U.S.:
1970 76.9
1971 76.1
1972 76.1
1973 74.9
1974 75.1
1975 77.3
1976 77.0
1977 75.8
1978 74.6
1979 73.7
1980 74.0
1981 73.1
1982 75.4
1983 75.4
1984 73.7
1985 74.5
1986 75.5
1987 75.8
1988 75.6
1989 74.9
Surprise! lIving standards for the U.S. are higher! The reason is that
this does not really reflect living standards -- just the relative
balance in society between consumers(C) and (G); and producers (I)
and military. Japan squeezes its consumers, taking away their share
of gdp, and redistributes the flow to producers. Thus, their
"standard of living" is much lower.
This is why this is not a particularly relevant data series to our
discussion.
---That's it for now,
Greg