Sunday, August 30, 2015

Economically, How Do We "Make Room"?

Though I write about the possibilities all the time, it is with an awareness of the difficult questions which remain, regarding economic access. Like so many, I can point to something and say "that is not working...this could work", but how do I know? Some things in life are easier to pin down as "obvious". For instance, it is mind boggling to me - as a market monetarist - that central bankers do not wish to adhere to a level nominal target, to generate monetary stability. Doing so would at least leave room for the economic commitments which individuals already seek to honor among one another.

It also seems obvious that populations need to make room for knowledge use at a broader scale, to maintain long term growth and economic stability. Unfortunately, the response to a slowing world economy has been quite passive, and there are far too many excuses that future growth is no longer possible. In spite of problems which stemmed in part from the progressive era, many then were pursuing visions which also became important elements in the economy. Today, the desire to generate economic participation has gone into reverse, particularly as conservatives and progressives alike question "materialism" as a driver of wealth.

Materialism is not the problem in all this. Cutting back on various forms of consumption is a personal choice, which is already being affected to some degree by a lack of housing. Besides, too many around the world have yet to experience materialism enough to maintain the necessities of life. Further, the uncertainties about future employment in developed nations, also matter for developing nations which need new strategies beyond traditional production as well. In all of this, time value needs a place alongside skills value, so that economic access remains possible. Why has it been so difficult to envision the nature of time value, as economically viable?

Even straightforward efforts to "make room" through traditional means, are meeting resistance from those who have substantial property values at stake. Some recent arguments to make more room in the cities are reminiscent of arguments from Henry George. I've read more than 400 plus pages thus far of "Progress and Poverty" in recent months, but remain dissatisfied with his arguments for land taxation as a broad based solution. When Henry George observed that not everyone would be allowed into the city, he reasoned that the wealth of land could somehow be redistributed to those who were denied economic access.

One problem for me in this regard, is that land use does not quite appear to be the wealth generator it once was. In recent years there has been plenty of discussion to build higher population densities in sought after cities. But even if this were possible, would cities be able to accommodate newcomers with work, given economic conditions as they exist now? The U.S. is not the only nation with these problems. Paul Romer writes:
The people who work in the global-developing-consulting-complex seem to develop a hard wired commitment to the containment paradigm: governments should contain the size of cities. This means that governments are supposed to create an artificial scarcity of urban land.
Those who have kept up with my writing know that I liken this artificial scarcity of land, to the artificial scarcity of knowledge use, in that they are relatively accurate monetary reflections of one another. As it stands, governments probably do respond to the requests of city populations, to make sure that already generated wealth can remain as intact as possible. It will be interesting in the years ahead to see if cities can make room for the ones who still seek access. Paul Romer hasn't had much luck with charter cities thus far. And even though I dream of mini charter city versions for knowledge use systems, the question as to how populations will make room for their own, may take decades to answer.

No comments:

Post a Comment