Econ 101: Money and Wealth

     This morning (6October, 2014) I heard a report that wealth has increased round the world, and that China will soon become the single most wealthy country. Apparently, wealth now stands at 186 trillion dollars, and by 2018 or thereabouts China will be the richest country in the world with over 50 trillion dollars. The confusion between wealth and money continues apace. In fact, the images for an online search on "wealth" all showed money.
     Wealth is not money. Wealth is stuff. Wealth the capacity to make stuff. Wealth is the capacity to provide services. If you want any of this wealth, you can trade some of your wealth for it, or you can use money.

     But money isn’t wealth. You can’t eat it. It won’t keep the rain off. It won’t make your bed or cook your meals. It can’t catch fish, nor make the nets for catching fish. Only people can make umbrellas, do the chores, make nets, and catch fish.

     What the news really means is that since the last time someone looked at how money is spent, at least 186 trillion dollars worth of wealth has been created and consumed. That’s it. And since an enormous amount of wealth is created and provided without money changing hands, and an enormous amount of wealth is created and consumed without being traded at all, the figure of 186 trillion dollars is certainly too low as a measure of wealth. Just how much too low is a real issue. Some time ago (sorry, I don’t have a reference) some economists tried to estimate the value of non-monetary transactions. They did some surveys, and concluded that about 30% of the “real economy” was not recorded in GDP figures. Personally, I think that’s a low-ball estimate.
     For example, composing and revising this screed is a service. It’s a service to me personally because it makes me think and clarify my thoughts. It’s a service to whoever reads it because it does the same for them. What is it worth? If I had a marketable presence in the marketplace of ideas, I would get some money for it, and that would be its value at the time. How much money? That would depend on my reputation, on the likelihood that other people would pay for e-book or paper copies of it. Right now, its value can’t be estimated with any kind of accuracy because I offer it free, gratis, without expecting money in return.

     Most of what I do these days are services for myself and my family, friends, and community. If we had to pay for these services, we couldn’t afford them. And that is the case with most of what we do to keep life comfortable and pleasant. It’s true for most of us. Only the people with pots of money can afford to pay for services that rest of us provide for ourselves and for each other.
     The fact that we can’t afford to pay for these services means that the value of these services exceeds the value of our disposable incomes, at least. For half or more of us, it exceeds the value of our incomes, period. That, I think, is a clue to how to calculate the value of the non-monetised economy.

2014-06-10 & 2025-09-15

Miles Kington, ed. Punch on Scotland

     Miles Kington, ed. Punch on Scotland (1977) A scrapbook of cartoons, articles, squibs. Mildly amusing, with some semi-serious commentary on Scots-English relations, the invented traditions of the tartan and the kilt, and some serious comment on Scottish independence, which may happen any year now. A pleasant intermittent read.
     Best cartoon: Lady of the house, to newly engaged maid: “Mary, why did you not tell me in your letter of application that you were Scotch?” Mary: “I didna want to be boasting, Mem.”
     Exactly. **½

Royalty Close Up (2013)

     Royalty Close Up (2013) On TVO. About Kent Gavin, who learned photography by working at it when he was hired by The Mirror, which was always a tabloid, but back then was still a family tabloid. He became photographer of the Royals more or less by accident, and many of the most memorable images of them were his. He also photographed war, sports, and “general news”, and excelled in all genres. Why? Because he loved to take pictures of people, and because he learned how to see the picture through the lens. He mastered his craft before digital, when film, even for a daily paper, was expensive. He developed a knack for waiting for the right moment.
     His relationship with the Royals was complex and oddly personal. Not that he was ever an intimate friend, but they came to rely on him for “good” photos that told the story they wanted to tell. His remarks on the Royal’s awareness of the power of photography and publicity generally display an acute intelligence and deep understanding of how public images are created and propagated. He knows that ultimately a good photo depends on the relationship between photographer and subject, not between subject and camera; a good subject is one who likes the person wielding the camera. Even Diana, who liked being photographed, is better in Gant’s photos than in other peoples’, at least to my eyes.
     Gavin clearly wanted to tell a good story about the Royals and just as clearly wanted to the story to be the truth, even if it wasn’t the whole truth. That’s why we now expect candid photos that display the Royals’ (and other celebrities’) reactions to the events they witness. Unlike the paparazzi, Gavin did not want to trap or trick his subjects into revealing those aspects of themselves that none of us want to be made public.
     The film is sectioned into chapters about the Queen, Diana, Charles, etc. It’s worth watching, more as a seminar on how to take pictures than for still more revelations about the Royals. The music is cliched and therefore feels obtrusive to me. The photos are wonderful; I would have liked to have more screen time with them. **½

Wendy Northcutt. Darwin Awards II

     Wendy Northcutt. Darwin Awards II (2001) A re-read. If you have average common sense, you will not be able to imagine the ways in which people have caused their own demise. This compilation helps you understand how stupid some people are. Or maybe not: It’s impossible to imagine being smarter or dumber than you are. BTW, the vast majority of these voluntary self-removals from the gene pool are men. There are more men than women at the bottom as well as at the top. The website is still active. Chuck Shepherd’s News of the Weird  is an even richer compilation of stupidity. **½

Dale Wilson. More Tracks of the Black Bear (2013)

     Dale Wilson. More Tracks of the Black Bear (2013) Dale’s father was the engineer on site when the docks at Michipicoten Harbour were rebuilt, and became Chief Engineer. This connection may explain Wilson’s fascination with the Algoma Central and Hudson’s Bay Railway. But maybe not. The ACR has a lot of fans with no family connection. It’s a railway that survived against the odds, and still (as a part of CN) provides useful services.
     Fans will be pleased with this book, another collection of photographs, memoirs and miscellaneous documents. Wilson has arranged them in chronological order, with explanatory notes here and there. The result is a pleasant anecdotal history of the line. Readers interested in Algoma and Sault Ste Marie will also find this book a good read.
     I like these scrapbook-like histories. They contain a good deal of primary material, the kind that professional historians arrange into plausible narratives of cause, effect, and influence. The scrapbook leaves the task of interpretation to us, engaging us in the oddments of actual life. The photographs are well reproduced, but some documents have been damaged by time, so their reproduction is not as clear as we might wish. *** for the fan, **½ for the casual reader. Disclosure: Dale used one of my photos.

Fight the Mammals!

Occasionally, I check in to Boing Boing. I found this charming poster urging dinosaurs to defend themselves against the mammals. Logical, when you think about it in certain way.

POEM IN A COLD WINTER

POEM IN A COLD WINTER

A bird's song choked in my throat, I said.
And I saw a tin-whistling billy-goat
when the moon bloomed red as a rose.
And a grey church
with graves and black yews around
that's dead still, except for the sound
of the billy-goat's tune
dancing like laughter in empty rooms.
There was a blue sky, with chanting white clouds,
and a bottomless, sun-high sky that sowed shrouds
on a dead-still earth.
And the whistling shriek from the north-wind's throat
was the cornflower laugh of the billy-goat
dancing in the molten-gold pools of the ancient years
when the moon bloomed red as a rose.

[©1962; publ. in March 62, University of Alberta]