Government Enables Prosperity?

Orientation

Governments intervene to affect, directly or indirectly, what people and businesses choose to do as they work and create wealth. Politicians continually refer to the economy and people credit or blame the government for the state of it. But there is no «economy», there are only people pursuing wealth-creation (economic) activities, or not.

Governments have, or think they have, a responsibility to sustain or enable prosperity i.e. the generation of wealth. So the interacting-for-benefit approaches can generate a framework relevant to their proposals and interventions. Anyone can use this impartial framework to judge for themselves. See the findings now.

Closed«There is no such thing as an economy.» Why?

The economy appears to be an idea or concept. It can be thought about and reasoned about, but it cannot be observed and cannot be causative or powerful. It is not a THEE entity because THEE only deals with things that are directly observable. What are observable are individuals and organizations that pursue activities that create wealth for themselves. Read more about mysterious things like money, prices and lending from a combined Market-centred and Reality-centred perspective.

NOTE: Investigation of societal institutions (PH'5Q4) in 2020-2023 has led to the view that "the economy" is a societal institution with specific properties. See more here.

ClosedBackground Knowledge

Order of Topics

A Market-Eye View of “Managing an Economy”

This provides rather simple formulations aiming to clarify: wealth, money, prices, lending and competition. (Political issues are examined elsewhere.)

Adopting an Economic Focus for a Society

In using the approaches to interacting-for-benefit, the frame of reference changes from «a person-interacting-with-others in society for their own benefit» to «a government-interacting-with-its-society to benefit economic activities».

Strengthening Meta-Economic Management

The seven approaches explain how governments alter the social environment within which wealth-creating activities are pursued. THEE principles are meta-economic rather than strictly or directly economic.

Upholding Commerce & Coping with its Side-effects

Government depends on commerce for prosperity and for its own funds. So it should value commerce highly. At the same time, interventions are required to handle inequalities and environmental damage which unregulated business generates.

Politico-economic Choices and Forces

The framework is a hierarchical structure with a THEE-Tree specifying interrelated meta-economic responsibilities and influences. A full examination of Politics itself is posted elsewhere.

Two Ticklish Issues

Key notions, well-recognized in public debate about the government and its handling of the economy, can certainly be seen to link with the seven fundamental approaches to interacting-for-benefit. The value of this application is twofold:

  • A common-sense framework modelling how governments function so as to enable (or disable) widespread prosperity.
  • The possibility to appreciate and debate choices made by governments in a new way.

Unlike executives and management consultants, politicians and top officials are unlikely to take note, given the current state of politics. Politics is formulated within a separate set of frameworks posted here.

Because, in the final analysis, the people are responsible for their politicians, it remains important that you and I and everyone else should broadly understand how government could and should operate to enable a prosperous society.

Most economists are proud members of their discipline, i.e. they are cause-centred, which has certain implications:

  • Economists are devout adherents and inevitably tend to look down on or ignore the contributions of other disciplines, and are generally dismissive of common sense.
  • Some economists may develop a broader view and become perspective-centred—at which point their colleagues will lament their loss to the discipline, and the diminution in quality of their contributions.
  • Economists are socialized to view all intervention from a rational perspective. However, people are not rational actors in the economic sense, and economies are powerfully driven by socio-emotional factors. So economists make poor investment advisors and poor predictors of economic developments.

From a power-centred perspective, which is often the secondary mentality for cause-centred people, academics are dependent on tenure or grants from government bodies. They become inextricably caught up in competitive scrambles for prestige, power and grant money. This leads to a largely unconscious tendency to distort realities or give in to political pressures, however impartial their presentations to colleagues may seem.

Originally posted: Q3-2009