Re: PK on GDP surge - what could a socialist say ?

[Doug Henwood <dhenwood@xxxxxxxxx>]

Jurriaan Bendien wrote:

> This is very a similar story to New Zealand and many other developed
> capitalist countries. No wonder that we are dealing with jobless growth !!
> But a socialist would need to ask: who is actually doing the spending ?
> Which social classes are buying houses and durables ? How can you say that
> "tax breaks" accounted for growth, when we are talking about a consumer boom
> mainly fueled by loaned money and refinancing ? I haven't done a
> disaggregate analysis of the US GDP data, and anyway the quarterly figures
> usually don't provide that anyway. But even without seeing the data, clearly
> you cannot "borrow or refinance" without having some kind of collateral or
> asset already, and therefore the people spending must be in a position to
> spend, i.e. they must have property already, i.e. it must be a propertied
> class who is doing the spending.

A major prop to consumption in the U.S. over the last 2-3 years has
been home equity withdrawals - borrowing against the appreciated
value of owner-occupied housing. Since 68% of U.S. households own
their dwellings, your definition of "propertied" would have to be
rather broad.

Doug