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Tuesday, October 06, 2015

'Demand Deniers'

Chris Dillow:

Demand deniers: The Tories seem ... oblivious to problems of weak demand. ...
Jeremy Hunt tries to justify cutting tax credits by claiming that he wants to create a culture of hard work.
Let's leave aside the fact that working long hours is often a sign a economic failure - of low productivity - and ask: what would happen if people offered to work longer?
The answer is that, in many cases their employers would reject their offers. There are already 1.28 million people who are working part-time because they cannot find full-time work. This tells us that, for very many people, the problem isn't a lack of culture of hard work but a lack of demand for their services. ...
These ... examples raise the question: why are the Tories demand-deniers? Alex offers one answer: it's because they still believe that poverty is the fault of the individual - they are committing the fundamental attribution error.
The counterpart to this is a perhaps willful failure to see that there are also systemic reasons for low pay - not just bad policy, but fundamental properties of the capitalist economy.

    Posted by on Tuesday, October 6, 2015 at 09:00 AM in Economics, Politics | Permalink  Comments (12)


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