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September 09, 2005

Polly Twitters.

Polly tells us all how it is:

If Bill Gates moved to Albania its GDP would soar meaninglessly.

Really? Albania’s Gross Domestic Product would soar if an individual with great foreign wealth and a large foreign income moved there?

The rest of it is "We must be like Sweden".

Which, as we know, means school vouchers and charges for medical treatment. And economic literacy. Fine by me Polly.

Update: Polly responds!

Don't be pathetic. Of course I meant if he brought his income and wealth with him

Which is something of a problem. GDP does not measure wealth (hint, wealth is a stock, GDP is measuring a flow) so Bill’s stocks and so on would make no difference at all. There’s also another problem. Here’s the definition of GDP from Wikipedia:

GDP is defined as the total value of final goods and services produced within a territory during a specified period (or, if not specified, annually, so that "the UK GDP" is the UK's annual product). GDP differs from gross national product (GNP) in excluding inter-country income transfers, in effect attributing to a territory the product generated within it rather than the incomes received in it.

Bill Gates moving to Albania makes no difference to that part of his income which is generated in Albania. Whatever profits Microsoft (and any other of his companies) make in Albania is entirely unaffected by the fact that he lives there or not.

That was the point of my original post. GNP may change, but GDP would not. Even if Bill did take his income and wealth there.

(Well, to be strictly truthful, it would rise a little, by the amount that Bill spent on locally produced items which he does not now. Like maybe his food bill and utility payments. Can’t think of much else he would buy domestically produced.)

Anyone want to club together to buy Polly a basic economics text book?

Update Deux. Heh! As Harold reminds us in the comments Polly has also said this:

" [T]he fate of those at the bottom of a pecking order within a rich society is far worse than those in a poor country who feel they belong among the generality. The UN figures show that exclusion kills, in both infant deaths and shorter lives."

and at other times "Inequality Kills!" or some such. So if Bill does move then thousands of Albanian babbies will die needlessly and some fewer number of American ones miraculously survive (because, of course, the effect upon inequality of the Gates fortune will be greater in a small poor country than a large rich one.)

A solution to this latter problem does occur. All the really rich people could go to one place where they would be equal together, as we left behind would be (more) equal together and death rates would drop everywhere. Whadda ya think? Could we call it Monaco?

And to think, this woman is in regular employment.

September 9, 2005 in Idiotarians | Permalink


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Can't we just get together and club her???!

Posted by: Dr. angry economist | Sep 9, 2005 2:13:46 PM

I think you would have done better to respond to Polly's point (since it's very wrong) rather than mocking her for not understanding the difference between GDP and average income.

Polly was trying to say that the presence of a Bill Gates in Albania would raise the average income (or wealth) on paper, but wouldn't improve the country.

This, of course, is bunk. Had Bill Gates developed Windows and built the Microsoft campus in Albania instead of Redmond, the Albanians would be much, much better off. He became fantasically rich by creating a tremendous amount of wealth.

H@ll, if Gates bought a vacation home in Albania, the Albanians would be marginally better off, as his parties, servants' salaries, construction costs, travel into and out of the the country, etc., would transfer wealth into the country.

Tim adds: No, no, it is important to mock her. She wants to write about matters economic then she had better understand matters economic.

Posted by: J Mann | Sep 9, 2005 3:02:40 PM

Why worry what Polly says? She's bleating to an ever decreasing band of ageing followers who still can't believe that socialism is dead and buried, even in the Labour party.

Posted by: Pete | Sep 9, 2005 3:49:05 PM

"Why worry what Polly says?"

She gets rolled out to waffle nonsense by the Gramscian Broadcasting Corporation about once a week.

Posted by: Rob Read | Sep 9, 2005 4:09:27 PM

Lots of the B*llsh*t she proffers is what the 'socialist worker' bearded fellas used to spout on about who used to intrude into our student halls years ago. Complete loons and conspiracy theorists, many of them were. Although a few notable exceptions such as Paul Foot or Eric Hobsbaum - although Polly couldn't hope to be in the same league.

I would have more respect for socialism if folks like Polly dropped the reins. It can be a powerful analysis of society, no matter whether you value the policy recommendations that come out of it.

Posted by: Dr. angry economist | Sep 9, 2005 4:41:10 PM

Tim asks "Anyone want to club together to buy Polly a basic economics text book?"

Can I add - can I be the person to throw it at her or club her with it. We could form a book club together to club her.

Apologies for the bad puns, but its been a tiring stressful week with some unpleasant work surprises, but some bloody good restaurant meals (St John nr. Smithfield and The Chop House in Butler's Wharf) and late nights and it is only with high levels of grumpiness that I can apply myself.

Posted by: Dr. angry economist | Sep 9, 2005 5:05:02 PM

She's not dangerous. She's paid by her readers, who want her to provide them with the good old stuff that used to get them excited in the 60's while they shuffle towards retirement in the schools and town halls of Britain.

Posted by: Pete | Sep 9, 2005 5:27:48 PM

According to Polly, not only would Bill Gates's move to Albania increase GDP, it would make the lot of the poor in Albania much worse:

" [T]he fate of those at the bottom of a pecking order within a rich society is far worse than those in a poor country who feel they belong among the generality. The UN figures show that exclusion kills, in both infant deaths and shorter lives."

So, if Bill Gates moved to Albania, Albanians would suffer shorter lives and more Albanian infants would die while the converse would occur in the United States.

You see, poverty doesn't cause shortened lives and infant mortality -- the presence of rich people does.

Posted by: Harold Hedberg | Sep 9, 2005 8:31:52 PM

Would the dear old fool have a problem with these numbers?

''Circulation wise The Guardian has a mountain to climb. In August 2005 circulation dropped to a new low of 341,698 compared with 380,522 in August 2003 – the month before The Independent launched its tabloid version.'' Press Gazette 12/9/05

Posted by: Ted | Sep 12, 2005 4:29:20 PM