To the Editor, The headline on the business page of the Thursday November 16 Providence Journal said it all. “More state help for developer” For the umpteenth time the I-195 commission is giving more money to some very wealthy developer so they can build a building where the highway used to be. We are told this is necessary for economic development.
The reality is that the entire model of real estate development driven economic development is broken. Broken so badly it ought to be abandoned. Economic development experts such as the IMF and the World Bank have repeatedly pointed out that subsidizing the rich to build buildings does not contribute to long term community prosperity and drives much of the inequality that is harming our communities. In Providence we make this worse by focusing on building subsidized buildings for the medical industrial complex, which guarantees that health care will be unaffordable for more and more people.
Some day we shall learn, but as long as Wall St and real estate interests determine our policies, be prepared for more hard times, especially when the next real estate bubble bursts.
Original article https://mystudentvoices.com/steering-the-economy-toward-growth-8f208a8b8a7b
I have a rather different take on slower growth. I agree that rising inequality is a very big problem and undercuts growth, that tax cuts for the rich do not do any good, and that the wealthy do not invest because there really is not all that much that will give them large returns for their investments.
But what Yaneer Bar-Yam seems to be missing is the crash of ecosystems, the depletion of easily recoverable natural resources, especially forests, and climate change.
It is likely that there shall never be a long term return to high growth rates in the USA or the industrial west. More than half of humanity already lives in cities, so there are fewer agricultural and forest communities to send to shanty towns to fuel the next boom. The age of fossil fuels is coming to an end. Plenty of opportunity in renewable energy, but it will not create booms like fossil fuels, and if you look at growth rates in the USA by state and nationally, it is the moving fracking booms that keep the growth rate up, while well more than half the states have growth rates of less than 2% nearly every quarter for the last 10 years.
We should be looking for a steady state economy, or even a slowly shrinking economy in old industrial places so that the truly poor places in the world will be able to grow without destroying the resource base and climate that they depend upon for their daily bread. The billionaires will hate this, means they have to give up some of their power and priviledge. But it is how we shall survive on planet Earth.