Governments are chasing the wrong rain brackets

The writer, a FT, who is a chief executive of the Royal Society of Arts and former Economists at the Bank of England

For many governments, growth is the new God. Even between ecumenism, growth plays their political sermons. For Zealots, which includes the UK government, growth is the most important task of their lives. This leaves them in a state of permanent antiseptic, with all gross domestic product launches a reason to celebrate (if good) or recognition (if bad).

Religious dedication of a abstract concept is largely incomprehensible, barely a century age, to the strange daily citizen. But enthusiasm reflects a blatant global economic reality: growth has decreased financially. Among the G7 countries, growth rates decreased in half when the first 25 years of the twenty -first century are compared to the last 25 years of twenty.

This lower had great social consequences-weakening living levels, and flatulence of public debts and stressful public services. In a combination, this raises public dissatisfaction, and ultimately, political fragility. Restore growth, unlike these strong opposite winds, economic and social, and provide political redemption.

But is this? In this century, gross domestic product growth was not a guarantee of the high levels of living, especially among low -income families. In the United States, real income has rarely increased since the 1980s. In the UK, the average real wage is less than the time of the global financial crisis. There is no leaving on the horizon: It is expected that the income of 50 percent is less at the end of the beginning of this parliament, as was the case in the past.

During a referendum on Britain’s exit from the European Union, a member of the public reprimanded one of the panel player with: “This is the bloody gross domestic product, and not for us.” There was a statistical fact in this Quip. The recent growth in the United Kingdom, the United States and its beyond were not comprehensive, geographically and socially socially. As Brexit explains, the universal growth that focuses on profit and southeast adds only to public discontent.

The relationship between income and general satisfaction is one complicated. At income levels above about 75,000 dollars per person, the link completely disappears-the so-called Easterlin Paradox discovered in 1974 by American economy professor Richard Estlin. Above these levels, money can not really buy you (or happiness). But even below this threshold, the relationship between income and luxury is accurate.

Based on citizens’ surveys, Carole Graham Academy’s research indicates that upward movement is more important to general consent than income. For example, the poorest societies and countries, where the horizons have improved for previous generations, is the happiest of the most richer places where the prospects of generations have fallen or decreased. In short, generations trips are more important than GDP destinations.

When it comes to luxury, social movement outperforms national income. Permanent societal success depends on opening the opportunity more than maximizing the output. A different concept (barely a century, but it is less abstract) than GDP, carries the key to our sense of growth, growth and contentment – the “American dream” to improve generations, which was first discussed by James Truslo Adams in 1931.

The American dream died, for many. Surveillance studies suggest only about a quarter of Americans who now believe that “the American dream carries correctly.” Recently in 2010, it was more than half. The “Atlas of Opportunities” designed by economic expert Raj Citti proposes these perceptions accurately a new fact in which the social movement stopped, or in retreat, through many parts of the United States during the last century.

UK measures for social mobility indicate a similar stop or decline. Today, the average person in his twenties and early thirties earns less than his parents at an anti -inflation. Many are less likely to possess their homes than their ancestors and some of them are their ancestors. For them, Salem stopped the opportunity or in the opposite direction.

For many, this begins early in life. In the United Kingdom, children grow up 4.5 million in poverty. Poor children from school are likely to be excluded twice twice from school and a third failure in obtaining degrees at the age of 16. Nearly 1 million do not learn or gain by the age of 16-24. A generation that risk loss. The generation of the missing day is the growth of the missing tomorrow.

In the nineteenth and twentieth centuries, progress has become a social base, for the first time in the history of mankind. The erosion of social mobility during this century led to the era of severed aspirations and decreased expectations, which stops the growth of individuals, societies and countries.

Michael Young A climb of merit Dystopian’s image of social class division was painted by academic achievement. After nearly 70 years, this imaginary world is the reality of today. The rise of the merit has collapsed in the wealth of those who have low or non -existent academic qualifications. Low growth is not caused, but its effect. Without restarting the chances of branch, the pursuit of growth is a foolish task.

GDP measures everything but it is worth it. These words from Robert F Kennedy in 1968 until now more. The suspended social mobility prevented the only reliable way for luxury and continuous growth. In giving priority to national growth on local opportunities, the wrong altar governments pray and chased a rainbow. Next week I will discuss how to follow one right.