“They Left out Radio!” ― Human creativity is the key to economic growth

CascadeNewLogoBy Kathryn Hickok

Bull market? Bear market? Recession? Recovery? What does 2016 have in store for us?

Our economy—national, state, and local—is usually described in terms of numbers, percentages, and quarterly comparisons. But the picture is richer than an aggregate dollar value of impersonal production and consumption. No economy exists without millions of unique people bringing to the marketplace their gifts of creativity, intelligence, initiative, and effort. Human capital―the knowledge, skills, and experiences of people―is the true wealth of a society.

The story is told that during his presidency, Ronald Reagan remarked on the limitations of economic predictions that don’t take into account people’s capacity to invent the unimaginable. During a meeting on economic policy, he said:

“You know, back in the twenties I think they did a report for Herbert Hoover about what the future economy would be like. And they included all their projections on industries and restaurants and steel, everything. But you know what they left out? They left out radio! They left out the fantastic rise of the media, which transformed the commercial marketplace. And those were economists talking about the future!

“And now they make their projections, and they leave out high tech….”*

Fostering economic growth requires remembering where wealth comes from. Government doesn’t create it, and human beings can’t fully predict it. Individuals can change the course of the economy with one key new idea. So in this new year, let’s celebrate the special contributions every person brings to American enterprises, great and small, in Oregon and across the country.

* Peggy Noonan, What I Saw at the Revolution: A Political Life in the Reagan Era (New York: Random House, 1990), 146.

Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Portland program at Cascade Policy Institute, Oregon’s free market think tank.

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Posted by at 05:00 | Posted in Economy | Tagged , | 14 Comments |Email This Post Email This Post |Print This Post Print This Post
  • DavidAppell

    Kathryn Hickok wrote:
    “Fostering economic growth requires remembering where wealth comes from. Government doesn’t create it….”

    Government certainly creates the conditions for it. Wealth does not spring from a vacuum. It requires a strong central government to produce what’s needed for innovation to flourish.

    You’ll notice there are no prominent startups coming out of Somalia, or Ethiopia or Cuba. Why? They lack strong central governments that consistently apply the rule of law, produce infrastructure for transportation and communications, have a fair court sytem, and more necessary conditions.

    Refusing to acknowledge government’s role in the creation of wealth is blind at best, stupidly ideological at worst.

    • No Surprise, Chagrin Yes

      David Appell peels his pie charting from what’s left of US

    • Government also creates the conditions for destroying wealth, and for inhibiting its creation in the first place. That’s what’s going on in Somalia, Ethiopia, Cuba and other countries where government trumps civil society.

      • DavidAppell

        Really Steve? Seems to me loads of people are getting rich in America, instead of sitting around whining about the big bad government preventing them from doing so.

        What’s going on in Somalia et al is that there is insufficient government of any sort. There’s near-to-total lawlessness, and little-to-no infrastructure. If you can’t easily drive a truck across the country — here, on interstate highways built by government, earlier here on interstate railroads subsidized by government — you can’t very well deliver whatever product you’re creating.

        • I don’t think anyone here is whining about government preventing them from getting rich. You’re right, data seems to show that the middle class is shrinking at least partly because some of those people are moving into the upper income quintiles.

          I’m surprised that you lump Cuba in with lawless states like Somalia. Seems like it has lots of central government and infrastructure. And, with the U.S. reducing it’s embargoes on that country we’ll see how much wealth is created there in the near future.

          • DavidAppell

            I didn’t lump Cuba in with anyone. In fact, I didn’t mention Cuba at all.

            Is that all you have to complain about now — Cuba? Says a lot.

          • Didn’t you say above, “You’ll notice there are no prominent startups coming out of Somalia, or Ethiopia or Cuba.”?

          • DavidAppell

            Yes, you’re right, I did mention Cuba there.

            Has the Cascade Policy Institute suddenly gotten big donors from Cuba, that you’re so concerned about policies there?

          • I’ve been concerned about policies in Cuba and our ill-advised embargo of it for decades.

          • DavidAppell

            Why, when people like you, and those who fund you, have to much to complain about in Obama’s America?

          • Actually, I commend Pres. Obama for moving to normalize relations with Cuba and to lift the embargo.

          • DavidAppell

            That’s great. But you’re acting like you and the CPI has no issues left with the US, and so must focus on Cuba. Hardly convincing.

          • I wasn’t trying to convince you, David, just pointing out that you brought Cuba up here, not me. Others might get the point that we can learn some things from what Cuba has done wrong.

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