Re:A pessimistic vision of India’s looming environmental and...
by adventured on Sunday February 04, 2018 @05:56AM
(#16302288)
That's certainly a valid point.
Here's the broader problem: Italy's economy has not expanded since 1992 on an inflation adjusted basis. On a nominal basis it hasn't expanded since 2004. The population has expanded by about three million since 2004. The demographics have worsened in terms of an aging population, much like the rest of the developed world. That adds up to a painful scenario.
Italy's economic growth has been falling on a ten year averaged basis, since ~1960. That isn't super unusual, that's true of a lot of developed economies. The problem is, in the early 2000s it basically hit a zero growth flat-line, and has never picked up off of that. The significant economic contraction periods of 2008-2009, and 2012-2013, were never countered with bursts in post-recession growth as would be more typical. If you don't have a post-recession bounce of outsized growth, things tend to get super bad, super quick, as inevitably another recession will arrive and make the situation worse. Some meaningful growth is practically a requirement to a healthy society, in the sense that it pays for inevitable mistakes that are made politically and socially, including as it pertains to debt or policy mistakes. Without that, you have to operate at a level of perfection at all times.
At some point Italy has to figure out how to grow again. As a population ages, obviously, things only tend to get more expensive in terms of social welfare and having enough active workforce to pay for it all.
Ultimately there are two choices in that scenario: ration resources more tightly, reduce standards of living, and accept that as a new normal; or start growing again.
Here's the broader problem: Italy's economy has not expanded since 1992 on an inflation adjusted basis. On a nominal basis it hasn't expanded since 2004. The population has expanded by about three million since 2004. The demographics have worsened in terms of an aging population, much like the rest of the developed world. That adds up to a painful scenario.
Italy's economic growth has been falling on a ten year averaged basis, since ~1960. That isn't super unusual, that's true of a lot of developed economies. The problem is, in the early 2000s it basically hit a zero growth flat-line, and has never picked up off of that. The significant economic contraction periods of 2008-2009, and 2012-2013, were never countered with bursts in post-recession growth as would be more typical. If you don't have a post-recession bounce of outsized growth, things tend to get super bad, super quick, as inevitably another recession will arrive and make the situation worse. Some meaningful growth is practically a requirement to a healthy society, in the sense that it pays for inevitable mistakes that are made politically and socially, including as it pertains to debt or policy mistakes. Without that, you have to operate at a level of perfection at all times.
At some point Italy has to figure out how to grow again. As a population ages, obviously, things only tend to get more expensive in terms of social welfare and having enough active workforce to pay for it all.
Ultimately there are two choices in that scenario: ration resources more tightly, reduce standards of living, and accept that as a new normal; or start growing again.