The Coronavirus has brought Economic Growth to a standstill . All the media report this with graphs and charts to support this assertion. So completely has this notion of ‘ growth ‘ been absorbed that no commentator even bothers to define it . Here’s the definition : It’s an increase in Gross Domestic Product . And what is that ? Well ‘ GDP ‘ as it’s usually referred to is the total value of all the goods and services produced within a country. The necessity for Economic growth is the central tenet of the Neoliberalism virus because without it the Neoliberalism virus dies. It is impossible to overstate this. It is essential that this doctrine is absorbed by all of us as though our lives depended on it so that all the shenanigans that Finance and Efficiency bandits can construct their schemes to delegitimise the ordinary person’s contribution to society. Any activity that makes a profit is automatically assumed to contribute to the national pie which must go on increasing for the good of all . That’s how the story goes.
Well it turns out it’s not quite that simple. Wealth creation – defined in terms of a quantity of money – may actually comprise a proportion of money extracted from the pie. Surely that’s an anachronism .No it isn’t and this is why. Take a single example : insurance . For the most part we accept the need for it , even if we resent paying for it . But do all those premiums we pay increase the size of the national pie ? You only have to think about the question for a moment or two to come up with the answer ‘ no ‘ . No good or service that did not exist previously is created by insurance. The premiums we pay are extracted from the money value of all the goods and services we create. But when GDP is measured all those premiums are added together with all the goods and services to come up with a total . A very important sounding, but entirely bogus phrase has been invented to perpetrate this falsehood . ‘ wealth creation ‘ . Who could possibly question it ? Well the Coronavirus has done just that .
So there are ‘ wealth creators ‘ and ‘ wealth extractors ‘ . But GDP counting doesn’t discriminate between them . The money values of both are all added up to make the total.