Tag: David Cameron

The Political Pitfalls of Pessimism and Optimism

In the United States, we are often exhorted to be optimistic, enthusiastic, and positive about our society and one another, criticising “constructively” or perhaps preferably not at all. The United States has a particularly optimistic political culture, one where you really can make your campaign slogan “hope”, “change”, or “yes we can” and get away with it. The United Kingdom is quite a different place–in Britain, Prime Minister David Cameron got into office with the slogan “we can’t go on like this”. There’s a “change” message in there somewhere, but it certainly isn’t phrased in hopeful terms. Today I’d like to have a closer look at the role optimism and pessimism play in the American and British political systems, respectively, discovering how both extremes can have a deleterious effect on government.

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The Mother of All Output Gaps

There’s an interesting assumption going on behind the estimation of the output gaps (the difference between the economy’s current output and the economy’s estimated maximum potential output)–that not only did the economy decline during the recent crisis, but that the economy’s potential declined as well. This assumption leads to governments believing that their economies are less capable than perhaps they are, that the output gaps are not especially large, and that there is little revenue to be raised to offset stimulus spending, but what if it is not true? The idea comes from Capital Economics, a macroeconomics research company, has received attention from the Financial Times and Paul Krugman, and now it will receive attention from me as today’s topic.

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Where Have the Conservatives Gone?

Conservatives are people politically who are anti-change, anti-reform, who want to preserve things as they are, or return to the way things used to be not so very long ago. Conservatives always represent the time just passed or the time being passed. In the age of the industrial revolution, the conservatives were agrarians who mourned the loss of pastoral life. When the progressive era came along, the conservatives were capitalists who pushed back against the unions and labour reform. Nowadays, however, the left no longer pushes new social programmes, new reforms, or new ideas. Today, right wing politicians like Paul Ryan and David Cameron are the ones supporting things like “welfare reform”, “NHS reform”, “social security reform”, “Medicare reform”, and other reform policies that would change the state structurally, altering elements of it that have been in place for in many cases well over half a century. There is nothing conservative about wanting to change these policies. Change is, inherently, anti-conservative. So where have the conservatives gone? That is today’s topic.

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