Boomers: The Evil Generation!

What a great find! My number came from a conversation I had with my dad back in the 60s. We were talking about how much less expensive UNC was than the schools my bother and sisters went to. We all four graduated every two years from 1966-72. I'm guessing that he was talking about all four years I spent at UNC and not just one year and included room and board etc. Damn it was cheap! Good job setting the record straight.

 

(Too gulag-y?)

 

Anecdotally my dad went to General Motors Institute (now Kettering) and they have a mandatory work study program so you study for a semester, work an internship for a semester. Somehow it's setup so you still graduate in four years. Internships are paid. He was able to pay his full tuition and board with the money earned from his internships. So yes, it was much cheaper even adjusted for inflation.

 

Anecdotally my Dad went to the U of I on the GI bill. Much much cheaper.

 

Revolutions look terrible for economies.

 

Well they sure wouldn't if the damn reactionaries didn't turn them into civil wars every time

 

Even the post 1917 revolution growth looks like a return to trendline.

 

Here is a graph.

 

Well, sure. USSR's growth was mostly because of increasing the amounts of its inputs rather than productivity growth. That was the underlying cause of its eventual stagnation - the diversion of productive capacity into armaments was just a symptom.

 

But the USSR did better than average Latin America.
Using the same Maddison input: https://en.wikipedia.org/wiki/List_of_regions_by_past_GDP_(PPP)_per_capita

 

yes
the armaments race as such also imo not the reason.
Economy = Utilisation * Yield
As simple as that.
Measuring Yield improvement (the productivity) and have the right settings and programs in place to improve, increase it, key.
So far we are hardly able to explain past productivity increases by models.

 

That graph clearly shows that by 1941, the USSR's GDP per capita had exceeded the 1913 level, with growth rates that remained consistently faster than Japan's and Spain's till the 1950s.

 

But how can I blame that on the evil boomers?

 

The Cylons mastered time travel?

 

If you look closely at the graph, you can see that the growth lines of Japan and the Soviet Union were parallel from the end of the war through the 50s. Japan's was just a lower total. And since both nations were growing in that time and Japan started at a lower number, the only way for them to surpass the Soviets in 1960 was to actually grow faster from about 1958-1961.

 

Russia missed the boat of the shipbuilding industry
The traditional booster of your steel industry.
And shipbuilding is an export product to the countries that buy your ships, the western developed countries.
Russia lacked the structure and know-how in efficiency in mass production, lacked capital, lacked convenient ports, lacked market for full economy of scale.

After the US and the UK strong there, Japan developed in the 50ies its steel industry at the highest global capital, productivity, (imported) knowhow and quality level, and controlled in the early 60ies more than 50% of the global shipbuilding market. Growing to two-thirds when the OPEC 1973 crisis did hit.
Korea applied the same model of steel industry and shipbuilding, currently it is China.
Stell needs high capital, shipbuilding low labor cost.
When your labor cost gets too high you should have already build up your car industry as main steel customer.

Russia missed that fast lane completely.

 

It seems that Russia/USSR has always tried to take a short cut to establishing a vibrant economy through limiting wealth creation to the very top of the society. It failed in the 19th C, after WW1, after WW2, and after the collapse of the USSR. Russia seems to refuse to push wealth down to create a significant middle class. Tzarism is alive and well.

 

Russia has always missed the traditional entrepreneurial small company class: the godfather of tech innovations and synergies. Already for Czar Peter the Great the conservatism and immobility of "his" people was maddingly frustrating.
A history of rural nobility with peasants, and some courts in some cities. Enough nobility to lead wars, enough peasants to become soldier. But not much of the guild driven industrious wave that started in Europe in 1300 and generated a fabric of activities, that survived the traditional big industrial revolution companies (mining, coal, steel, chemistry, shipbuilding, car) and that were re-iginited when the traditional conglomerates reduced their manufacturing depth in the 60ies-70ies in the western countries.

Communism did improve a lot !
For a while.
And... is plan-economy to get from no-where to a decent base level of industry communism ?
Or is that plan-economy with an obedient population ?

If you look at all kinds of graphs of the period of the revolution to 1960, comparing to medium developed countries, the progress is impressive (though no "fast lane"). Or should I say until Brezjnew ?
Did the worker class, the peasant class really benefit ?
A steady job for steady poverty of which you don't die. Real wage growth no-where, although social/health care increasing. Average age not high.
A very high female labor force participation of around 50% starting in WW2 and continuing... but also no good productivity increases... one of the main deficits of the Russia model.
Everybody worked to apathic exhaustion, and despite a very low fertility rate and population growth (high and deep female education + high labor participation) it took until the 60ies before food of 2,000 kcal/capita increased to 3,000 kcal/capita.
Russia is also an economy on the periphery of Europe since centuries, as it still is, also because of the big domestic distances.

I think that with Brezjnew the success potential of the traditional Russian plan-economy model came to an end.
Too difficult to plan in a central top-down way all those small entrepreneurial companies of the western economies in their endless process of picking up something new, being started, grow, getting consolidated ?
I think that from Brezjnew onward the capital investment waste rate became very high and the lack of focus on productivity improvement hurting more and more.
Basically an allocation issue of efforts and capital..

 

The last few pages tell me that the situation with the USSR and its economic development is not as simple as capitalism=good, communism=bad.

You can blame the boomers and such dogmatic rejection of socialism for the endemic ills of the global economic system that we've so keenly felt in the last decade or so.

 

Yes, things tend to more complex than we typically choose to see them.

And we can apply what we agree on above to your statement here.
Other than the growth of income and wealth inequity, what are "the ills of the global economic system that we've felt in the last decade or so"? Can you list them?