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Britain Is a Developing Country

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Re: Britain Is a Developing Country

#211

Post by rsynnott »

theironhammer wrote: post #143
grej wrote: post #42

Earlier quoted context omitted.

The UK still has a strong military, a particularly strong Navy, plus whatever remains of their portion of North Sea oil and gas. But they missed their window after Brexit to strike the trade deals they needed, and now any trade deal they make will probably be under quite unfavorable terms.

Re: no trade deals post Brexit. That was always going to be the case. Brexit fantasists thought they were going to recreate the empire with UK at its center. They also thought they could do a deal with USA. What does UK offer USA if they're not in Europe?

It's hard to see, in any case, how any UKUS trade deal (unless it was a colonial-style deal which greatly favoured the UK, or alternatively unless the UK was effectively subsumed _into_ the US; neither were ever on the cards) could possibly replace EU market access.

Re: Britain Is a Developing Country

#212

Post by hn_throwaway_99 »

I thought this was a good article, despite the fact that I think the title is unfortunate (lots of comments here arguing over what a "developing country" means, but I think it's fair to just use the definition that is used and discussed in the article, i.e. a country that just has to use existing technologies more efficiently in order to increase economic growth, not necessarily invent something new).

The thing that is most interesting to me, and also because I think it's a warning to the US, is the impact of housing costs. GDP per capita at PPP is 39% more in the US than the UK, yet UK housing prices are nearly twice (!) as much as the US on a per-square-foot basis. And I thought US housing prices were nuts!

There is a good book, "Who Owns Britain", that points out that just 6000 landowners (mainly the Dukes, Earls and Barons a la Downton Abbey, but also large institutions and the Crown) own over half the land in Britain. That gross concentration of land wealth is basically strangling their economic dynamism.

I'm curious, how can people in the UK with "normal" jobs ever afford home ownership? I mean, say I'm a senior software engineer with say 8 years experience - based on UK average salaries and housing prices I don't see how I'd ever afford a flat in a decent sized city if I wasn't already wealthy.

Re: Britain Is a Developing Country

#213

Post by twixfel »

aetherson wrote: post #183
twixfel wrote: post #82

Earlier quoted context omitted.

Argentina was 100 years ago one of the richest countries on the planet. I'm not saying that such a decline will will happen to the UK, but it is myopic to suggest that it is impossible. It's only "impossible" if we actively stop it happening.

I looked into this and I don't actually see any sign that Argentina suffered any long-term decline in established GPD per capita. It had a few sharp breaks and recessions that undid 10 or 20 years of progress. But all of the stuff about 100 years of decline in Argentina economy is based on counterfactuals about how they "should have" grown, not about absolute losses.

Well yeah most people are obviously referring to relative decline, I'm surprised you even needed that explaining to you, unless you thought that Argentina really might actually be poorer today in real terms than it was in the year 1900.

> counterfactuals about how they "should have" grown

No, they were growing a lot and extremely wealthy, then they chose to go down a low growth path. Growth is not some magical thing, as if they just stopped growing for no reason as you appear to be suggesting. The point is their growth trajectory changed for very particular reasons, which were mostly things in their control.

I mean if in 100 years time the USA was the poorest country in the world but still richer than it is today in real terms, would you really go "yep, yep, nothing to see here, stop dealing in counterfactuals"? Obviously not.

Re: Britain Is a Developing Country

#214

Post by twixfel »

dragonwriter wrote: post #201
eterm wrote: post #199

Earlier quoted context omitted.

They're trolling, surely. No-one thinks Russia has a more stable government than the UK. They had a failed coup not even a month ago!

Failed coup attempts are signs that someone wants the government to be unstable, but less so that it actually is. Russia’s government has been very stable for the last couple decades, with little change in substantive authority even in the inter-Putin period when Medvedev was nominally President; certainly much less substantive change than in the UK. (One might reasonably suspect its the kind of stability produced by…

Truly stable countries don't have coups at all. A coup of any kind is a sign of instability.

Re: Britain Is a Developing Country

#215

Post by osullivj »

skippyboxedhero wrote: post #85
iLoveOncall wrote: post #76

Earlier quoted context omitted.

Under two years of employment, which is the majority nowadays, you can essentially be fired at will. The rest is true, but a absolutely major one that is missing in the UK is unemployment benefits. If you lose your job you basically have no income at all.

Unemployment benefits exist through UC. Most people who are unemployed, in practice, also claim a number of other benefits that substantially boost your income i.e. housing benefit (so your rent is paid), ESA (another £100/week)...this has created another set of issues where lots of people have become economically inactive rather than "unemployed"...great statistically but not so great for people...but yes, the welfa…

A very big chunk of that 100B benefits budget is the state pension.

Re: Britain Is a Developing Country

#216

Post by osullivj »

anyoneamous wrote: post #206
iLoveOncall wrote: post #80

Earlier quoted context omitted.

I lived in France, Luxembourg and the US, compared to the UK all feel like if you stepped 100 years in the future, especially Luxembourg. I didn't experience much of the social services in the US so I won't expand on them, but in Luxembourg and France you get world class healthcare for free or very cheap (even for foreigners) in a timely manner, you get years of unemployment benefits, public transportation is better…

So the obvious question is: what's the catch? France is the best comparison of those you mentioned - their GDP and budget deficit are similar to the UK, so where is the extra money coming from to fund this world class healthcare, generous unemployment, and higher class public transport?

Higher income tax

Re: Britain Is a Developing Country

#217

Post by osullivj »

mhh__ wrote: post #75
barry-cotter wrote: post #2

> the UK is now a lot more like Poland than it is like the United States in terms of the kinds of growth it needs to do – driven by improved use of existing technology and inputs, and accumulation of capital, rather than driven primarily by technological advancement. With the exception of a few sectors like AI, we are so far behind the frontier in terms of economic development that worrying about technological progre…

British businesses are not very productive, technology is not a bad way to improve that.

One of the reasons for the UK productivity gap is our oversize services sector. In services businesses meet demand by adding headcount, and falling demand is met with layoffs. Since UK hire and fire rules are more flexible than eg FR/DE that works for secs biz. We do still have a manufacturing sector, but much of it is invisible as its the arms industry, where Britain is still a big player. That's OK because the arms industry is less price sensitive than consumer manufacturing like cars, white goods etc. In those sectors strict rules on hire and fire has forced FR and DE industry to figure out how to scale by means other than headcount.

Re: Britain Is a Developing Country

#218

Post by DragonStrength »

avgcorrection wrote: post #81
whymauri wrote: post #52

Earlier quoted context omitted.

The fact my dad grew up in Venezuela when it was the 4th wealthiest nation in the world per capita (granted, Europe was recovering from WW2) blows my mind. It was still top 20 by the 70s. [0] [0] https://www.nationmaster.com/country-info/stats/Economy/GDP-...

It’s hard to be a petronation in the Americas.

Resource curse issues have little to do with the specific resource or geography. Many of the poorest places in the US were once its richest.

Re: Britain Is a Developing Country

#219

Post by DragonStrength »

nradov wrote: post #179
avgcorrection wrote: post #81

Earlier quoted context omitted.

It’s hard to be a petronation in the Americas.

It's only hard to be a "petronation" if you make it hard. The USA produces more oil and natural gas than any other country in the world, and we seem to be doing well enough. Similar for Canada. https://www.visualcapitalist.com/visualizing-the-scale-of-gl...

Being a "petronation" implies the economy is centered around petroleum. The US economy is not. Our largest companies are currently tech companies, no longer oil companies. The temptation is to center your economy around a single resource, holding back other areas of your economy. "Resource curse" is the term I've read for it applied to things like oil and good soil in the early years of US history.

Re: Britain Is a Developing Country

#220

Post by aetherson »

twixfel wrote: post #213
aetherson wrote: post #183

Earlier quoted context omitted.

I looked into this and I don't actually see any sign that Argentina suffered any long-term decline in established GPD per capita. It had a few sharp breaks and recessions that undid 10 or 20 years of progress. But all of the stuff about 100 years of decline in Argentina economy is based on counterfactuals about how they "should have" grown, not about absolute losses.

Well yeah most people are obviously referring to relative decline, I'm surprised you even needed that explaining to you, unless you thought that Argentina really might actually be poorer today in real terms than it was in the year 1900. > counterfactuals about how they "should have" grown No, they were growing a lot and extremely wealthy, then they chose to go down a low growth path. Growth is not some magical thing,…

This whole thread exists because a person said that they thought that the UK was going to have a lower standard of living in the future than the past. I assume you will now go direct your indignation towards them.
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