Re: how to compare living standards

On Wed, 15 Mar 2006 15:25:16 -0600, "Jim Blair" <jeb@xxxxxxxx> wrote:

"tonyp" <tonyp@xxxxxxxxxxxxx> wrote in message

If we're talking about the "supply" of _money_, perhaps. But I have a
sneaking suspicion that "supply-siders" mean something different by
"supply".

"Supply Side" is putting the emphasis on production: stress that goods must
be produced before they can be consumed. Saving is good because it results
in investment and capital. Consumption will follow. Build it and they will
come (so to speak).

Demand Side puts the emphasis on consumption. If the demand is there,
someone will supply the goods. Saving is not good because it reduces
demand. Don't worry about capital, there is always enough of that. Want it
and someone will build it (so to speak).

During the 1930's or in Japan in 1990's and maybe even now, Demand Side
thinking might be best. But I say not in most other situations.

In the U.S., the average capacity utilization for all industry during
the years 1972 to 2005 was 81%. The high was 85% and the low was 74%.
Clearly the problem has seldom, if ever, been inadequate supply,
rather it is insufficient demand. Supply siders take note.

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