Dysfunctions of the Welfare State: 1st Edition (Paperback) book cover

Dysfunctions of the Welfare State

1st Edition

By Joel Gibbons

Routledge

244 pages

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Paperback: 9781412810982
pub: 2010-06-15
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Hardback: 9781138522497
pub: 2017-10-06
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pub: 2017-07-05
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Description

This timely analysis of today's economic realities relates the headlines to the long term causes from which they spring. Why did we have a worldwide financial crisis in 2008? Is stimulus the answer, and what are its risks and potential returns? Why are our investments so unprofitable? Why are our citizens struggling to find work? Why do we repeatedly confuse effort with results? The author finds the answers to these questions in the dysfunctions of the welfare state.

Economics is the science of the creation and exchange of value, but Gross Domestic Product (GDP) confuses value with the creation and exchange of "goods and services." Along the way, GDP has become a measure not of value created, but of effort expended and of costs incurred. This confusion has become the cornerstone of policy manipulation of "the economy," because it is very easy to incur costs, though not so easy to create value. Policymakers are not eager to correct this discrepancy because it is easier to manufacture costs through brute force than to produce results that have real value.

This book pins down the major contributors to these distortions in a number of specific areas, including education, science and engineering, hospitals and other medical facilities, the public utility transmission grids, and in the trade deficit. It also pursues the distortions caused by short-sighted public policy in the capital markets. The book concludes with a discussion of market efficiency and inefficiency leading to the conclusion that policy intervention into the capital markets reduces their capacity to allocate capital productively. The author addresses this broad topic from the unique perspective of someone who has contributed both to the theoretical analysis and to the actual practice of markets.

Table of Contents

Preface to the Transaction Edition
Preface to the Second Edition
Preface
Part 1. The Misallocation of Effort
1 On Work
2 Cheap Labor
3 Education Today
4 An Application: Begging for Poverty
5 Cheap Capital
6 Subsidies as Far as the Eye Can See
7 Where Are the Economic Assets for Tomorrow?
Part 2. Credit, Inflation, and the Crash of 2008
8 Trust, Risk, and Regulation
9 Thoughts on Money Supply and Inflation: Money Ssupply, the Extra "S" Is for Extra Supply
10 More on Money Supply: The Last Two Years
11 Crash and Aftermath: The Crash of 2008
12 The Cost of Living and Inflation Reconsidered
13 Fallacies in the Measurement of Inflation
14 Money, Gold, and Inflation
Part 3. Proposals and Reforms
15 A Proposal on Tax Policy
16 Redefining Shares: A Plan to Return Corporate Control to the Owners
17 Unemployment and Blame
18 Do Not Confuse Effort Expended with Results Obtained
Part 4. Implications for Securities and Capital Markets
19 Risk Management in the Wholesale Power Market: The California Energy Crisis
20 Two Essays on Financial and Commodity Markets
Index

Subject Categories

BISAC Subject Codes/Headings:
BUS069000
BUSINESS & ECONOMICS / Economics / General