Minutes from my discussion with Dr Michael Hatcher, Dr Serhiy Stepanchuk, Dr Alex Mennuni.

These are my minutes; so, my interpretation of the ideas discussed, and my paraphrasing.

What are the limitations of growth, and what emphasis should governments place on using GDP as a target?

Many of the factors that accelerated GDP growth in the 20th century are negative (environmental exploitation), or convergent with capacity (birth rate, women in the workforce, population in higher education). In this sense, conventional metrics of economic growth are increasingly irrelevant, given unprecedented levels of equality, literacy, and general quality of life. Yet, any political term that fails to increase it is blamed by the public and the market.

Ultimately, the exponential growth of technology brings many economic considerations; in the short-term FAANGs+ bring beneficial forms of growth in the style that the mini budget was motivated to capture, with fewer externalities akin to those of firms during the Industrial Revolution (pollution, wide-spread monopolistic pricing and market failure). But modern industrialisation will show new forms of externality that we cannot yet comprehend (theories: Meta’s connectiveness and human-health, Amazon’s tax avoidance). The scale and problem of these externalities will increasingly determine the equality and efficiency in the economy of our futures.

A positive impact of technology is the way it has reduced the necessity for human labour (in 1928, Keynes predicted that we’d all be working 15-hour weeks by 2028; in 1956, Nixon targeted moving towards a 4-day workweek). Shorter workweeks have long been a option, without significant declines in productivity or revenue in studies dating back to the 50s, and the way technology compliments the work-process makes ever-shorter workweeks possible. What intangible currencies will be competed over when a Universal Basic Income is enacted in western economies? Status and power; humans will always compete over what is scarce to gain a social advantage.

Is the public capable of making well-informed decisions in referendums?

The public has a natural propensity to shave too much off with Occam’s Razor. The explanation that best-permeates the mind of the public is unlikely to give a story that is accurate enough to act upon, making for information asymmetry in a democratic system. Indeed, we compromise; choosing to elect leaders every four years, meaning our governance can be conducted by experts capable of appreciating the importance of a wide variety of explanations, rather than the simplest. The difficulty with such a hybrid system is that it subjects the public to poor governance when they are incapable of electing an expert party. Contenders rely on popularity, and so spread simple explanations for complex problems to get into a position of power, leading to demagoguery.

One solution would be to increase rates of higher education, and yet this strategy I fear will lead democracies towards more extreme demagoguery in the long-term. In some sectors already, education level does not equate linearly to expected wage; for a Brit to pursue a PhD in Economics, they are in fact forfeiting a higher wage (according to the statistics; in reality this may be due to the propensity to enter education). As technological unemployment (driven by automation) begins to displace the low-skill workforce, the number of years of education required for an individual to demand a competitive wage will increase. What happens when the rate at which the workforce is laid-off reaches the rate of capitalisation? Without effective policy (UBI, international tax-nets), there will be a reversal of education, and a decline in expertise for the general public, leading to a positive feedback loop of lower quality leadership and widespread social failures.