Economic Utility Analysis: Applied Industrial CEO Sees Little Evidence Of Recovery - WSJ.com
Think about the concept of "economic utility" and how it drives consumer choices and spending.
Think especially about these issues after the cost and pricing components have been subjected to interference by the government - which is exactly what is happening through government actions like the healthcare bill and higher taxes.
What is the result? The cost of producing services goes up; but, the pricing mechanism that would normally temper demand doesn't work. In fact, as in the healthcare approach of the administration, it works in reverse. It actually lowers the 'direct' cost of healthcare (thus increasing demand) by making it an indirect cost (tax-based).
And, as such, it takes money from things like housing, education, retirement, extra hours of work - that would normally have a higher utility function; and, it replaces them with a lower utility based on having less money to spend on them and, in some cases, taxes to boost their cost.
As a result, the overall productive equation of society goes down. Is it an exponential function? Likely it is.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment