Posted on 03/07/2013 7:59:42 PM PST by killermosquito
Economics question: When GDP is calculated does it contain government purchases in the private sector? It seems like a study should be done which attempts to measure the negative consequence of the private sector's growing dependence on purchases by government agencies.
If, for example, the federal government buys 10,000 Chevy Volts it makes GM look good in the financial reports but it comes at the expense of the taxpayer and it also puts the competition (Ford, Honda, Toyota) etc. at a disadvantage.
It just seems like someone needs to do an analysis of business P & L that shows what the revenues a business generated through government purchases and what revenues a business generated through private sector purchases. But this should be done on a large scale (this could keep grad students busy for awhile). For example, of the top 500 companies in the US what was the gross revenues with and without government purchases?
I'm betting that many successful businesses are not nearly as successful as they appear to be.
The problem in this country is not the separation of church and state. It is the growing dependence of the private sector on government largess. We need a separation of government and business.
Good questions.
BTTT
Not only interesting but very pertinent! Unfortunately government will never answer that question. Business is fast becoming a part of government - not private enterprise.
Big Business has always been in bed with Big Govt. That’s how they get tax breaks, etc. Now we’ve got Holder saying some banks are too big to jail.
Google “gdp calculation”, there are a few sites that come up that explain it; it’s a simple high-level calculation that uses data from various reporting sources.
Basically, yes, the challenge of government is to provide the basics of national defense, courts, state dept, etc., for as little as possible, since none of these is a tangible direct benefit to the taxpayer like buying a refrigerator. They are all necessary, but why pay more than we have to ? If it all could be provided for 10% of what we pay now, all that extra money would be in taxpayers pockets to invest in productive businesses or spend.
Productive private sector businesses produce things. Given a population of about 312,000,000, give or take, say they produce X in one year. Now what if that same population produces X times 2 in one year (like, instead of 10 million cars, they produce 20 million cars). The same people, just more is produced. The prices of things would tend to be pushed down, all other things being equal, as the same population (demand) would have twice as many things to choose from (supply) when purchasing.
Now for the wild conspiracy theory: what I’ve found is pointing me more towards mega-business being the controller of government and politics, instead of the other way around.
Mega-businesses that have become monopolistic find that they can have such great influence on government that they can use government to help them squash competition, and force people to buy their products and services.
The ultimate of this is Wall Street and mega-banks. The government relies on them to be brokers of Treasury bonds. Who pays for that government debt - taxpayers. Of course, taxes are collected by the government by force of law. And the more government spends, the more it finds it necessary to borrow. Most Americans have no idea that Treasury bonds are a profitable industry.
Problem is, when students were taught history in the past century, and what was covered in the news media, all of what would make this obvious was omitted.
For example, Senate Committee hearings regarding profiteering on WWI - no one today has any clue about them - but they actually happened and are on record.
Also, who were the founders of the Federal Reserve - it’s simply never mentioned in the mainstream. I asked myself - why is that ? Why would it be such a big secret ? Why would not history courses taught in America accurately recount the history of the founding of the Federal Reserve, and make mention of the men who were significant parts of the picture ? Businessmen in general - are completely left out of history curricula.
These financial interests long ago figured out that installing people who worked on their behalf in a few key places enabled them to have tremendous influence on government and on society.
It’s all quite simple, actually, but with a few ingenious but quite brazen tactics, the truth of what’s been going on is for the most part viewed as a fantasy, something too far-fetched to be true.
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