Yesterday I tuned into Chris Hayes’ Up with Chris. He and his guests were addressing the question, what would we like to see our economy do. There were various answers, but none of the responses addressed the most basic issue: what is the economy.
Most Americans summarize the economy as the unemployment rate or their income. They confuse their personal financial positions with a matrix of rules that determine the growth, output, and productivity of our economy.
Chris Hayes and his posse made the same mistake as well.
I like the Bradley Schiller definition of the economy. The economy is us, not something spinning out there in outer space, separate and undefined. The economy is about how we decide to use our resources, capital, and equity in order to produce more and raise our standard of living. We want to eat better and enjoy better health.
It’s a straight-forward definition, but more complex than an unemployment rate or level of income. The definition requires we step outside of ourselves.