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The US economy and the EU were the same size in 2008, the US is now nearly 2X

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Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#331

Post by 0xcde4c3db »

landemva wrote: post #169
mrb wrote: post #122

Earlier quoted context omitted.

" GDP PPP can increase whilst your economy contracts. " Still, if PPP GDP increases, with all else being equal (eg. stable population) it would imply the standard of living is increasing. That is why PPP GDP captures a more accurate measure of the real world. Said another way, what truly matters isn't "GDP growth", but changes in purchasing power/quality of life.

>> it would imply the standard of living is increasing. In USA, GDP includes the explosion of numbers of hospital admin staffers, energy prices doubled, and production of munitions which are given to Europe. That GDP does not increase my quality of life.

This reminds me of an old "ad" (not sure it was ever placed anywhere) questioning a similar tendency [1]:

> For years, economists have defined the economic health of a country by its gross domestic product. Trouble is, every time a forest falls, the GDP goes up. With every oil spill, the GDP goes up. Every time a cancer patient is diagnosed, the GDP goes up. Is this how we measure economic progress? Economists must learn to subtract.

[1] https://www.youtube.com/watch?v=0q-lEATP-9Y

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#332

Post by metacritic12 »

mrb wrote: post #96

Note this chart shows nominal dollars, not PPP-adjusted. The EU has certainly kept up with the US when looking at PPP GDP from 2008 to 2022: US grew from $14.8T to $25.5T EU grew from $14.3T to $24.3T What that means is that the prices of goods are inflated in the US compared to similar goods in the EU. That's all. Want something interesting? Look at China who grew from $10.0T to $30.3T over the same period (!) Sourc…

Except your conclusion of US inflation being huge doesn't square out in the data:

Eurozone inflation 2008 to today has been 33%

US inflation 2008 to today has been 42%.

This doesn't square with your implication that the US inflation is double the EUs.

https://fred.stlouisfed.org/series/CPHPTT01EZM661N

https://fred.stlouisfed.org/series/CPIAUCSL

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#333

Post by soligern »

dogma1138 wrote: post #101
mrb wrote: post #96

Note this chart shows nominal dollars, not PPP-adjusted. The EU has certainly kept up with the US when looking at PPP GDP from 2008 to 2022: US grew from $14.8T to $25.5T EU grew from $14.3T to $24.3T What that means is that the prices of goods are inflated in the US compared to similar goods in the EU. That's all. Want something interesting? Look at China who grew from $10.0T to $30.3T over the same period (!) Sourc…

No one uses PPP for measuring growth, GDP PPP can increase whilst your economy contracts. PPP isn’t a good measure for population’s wealth or quality of life especially for developed economies either. The economy of the US is still twice that of the EU and its global purchasing power has also pretty much doubled.

Why isn’t it a good measure? It costs maybe $0.50 to get a reasonable full meal in India, you’re not going to get anything close to that in the US. In second tier cities in India, people can rent a reasonable studio for $50/month, you’re not getting that anywhere in the US. Why shouldn’t that be a relevant metric?

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#334

Post by [deleted] »

FredPret wrote: post #326
conjecTech wrote: post #263

Earlier quoted context omitted.

Size is denominated in terms of some measure. You don’t eat dollars, and you can’t build a house out of one. GDP has doubled, but so have US prices. Does that mean the economy is actually stronger? Using PPP simply chooses to denominate GDP in terms of things other that fiat currency.

PPP is usually meant to compare economies and control for differences in cost of living, not comparing time periods. Inflation is when you compare the same economy in two time periods. Furthermore, economic growth is measured in "real" dollars, aka, excludig inflation. If US prices doubled as you say, then their economy is therefore now four times as large in the new, inflated dollars. None of this has anything to do…

[deleted]

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#335

Post by fakedang »

onetimeusename wrote: post #203
futureshock wrote: post #89

Earlier quoted context omitted.

I’d like to point out that the open door policy to refugees came because Europe was trying to escape the demographic trap and the collapse of the social safety net. The hope was that young refugees would become net positive GDP contributors for decades, an idea borrowed from the US. If that has failed, it’s due to a failure of integration. Europe can actually be quite a racist place and in many ways the US is better…

> due to a failure of integration. whose failure? Why are Europeans the default racists? The US is not even integrated and is going through large scale migration right now that has never happened before so the success of US integration is still too early to say. What does integration look like because the US has ethnic enclaves, everyone knows that. It's absolutely right that the US promoted demographic change to Eur…

European people aren't called racists as much as they are called deluded and self-righteous. The European govts were so confident of being in the right that they failed to counter the social changes happening in their own backyards, while lecturing other countries on their policies.

And by Europeans here, I mean the EU, the govt of some individual WE countries and a small minority of vocal activist personalities who haven't got any other purpose in life. Most run of the mill folks I meet are either strongly opposed or negatively indifferent to migrants, in direct opposition of their govts.

Most countries could have just said no to migrants, like Poland, Greece and Switzerland did. But they all wanted to play the self-righteous card.

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#336

Post by refurb »

rafaelero wrote: post #110
kryptiskt wrote: post #40

The economic engine of the Eurozone, Germany, keeps stepping on the brakes because they are so obsessed with their competitiveness and running huge trade surpluses. If the German consumers would finally be allowed to a bigger share of all the gains from their productivity it would be good for the whole of Europe as the biggest problem is weak demand. But no, we can't have that because then their trade surplus would s…

US wages have not followed US productivity for the last 50 years as well.

Why limit your analysis to wages alone? That’s cherry picking a number.

Look at real total compensation growth over that time.

The idea that the average worker is not better off now versus 1970 is not a reasonable take.

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#337

Post by refurb »

carlosjobim wrote: post #212
talldatethrow wrote: post #7

Earlier quoted context omitted.

Does all growth go to the same rich people, or do more people become rich?

More people become poor. Haven't you noticed?

Percent of people in poverty is much lower now than in 1970.

And that’s with the poverty level being a moving target.

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#338

Post by refurb »

Sharlin wrote: post #330
Alupis wrote: post #95

Earlier quoted context omitted.

You're missing the point. Even the poor do better when there's more jobs available, more job mobility, more housing, more stores, etc. All things that are created by wealthy companies and individuals. Everyone, including our poorest, benefit from a growing economy. We just have to examine our average poverty-level person, and compare them to poverty-level persons of other nations to understand this point.

Sure, feel free to compare American poverty-level people to poverty-level people in countries with stronger safety nets.

Analysis of inequality ignores government transfers.

Did you know that?

Re: The US economy and the EU were the same size in 2008, the US is now nearly 2X

#339

Post by Sharlin »

seydor wrote: post #29
midasuni wrote: post #5

All “growth” in gdp seems to go to rich people. Normal people have seen stagnant wages and increased costs from the owners. Why should I care if gdp isn’t increasing when I don’t see any gains whether it does or not?

while it's true and it s very unequal the difference has become so big that even the poorest americans are richer than most europeans.

And what do those "riches" buy them? Decent healthcare? A reasonable social safety net? Not having to work three slavery-like jobs without paid vacations or maternity leave or…? The ability to stay out of prison given the incredible incarceration rates in the US?
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