Time to look at world problems through world lenses

Some bright sparks from Stanford University have invented a new economic index, called the Sovereign Fiscal Responsibility Index.

Do we really need yet another economic indicator? There seem to be too many as it is, the mathematics underlying them is hidden from view, and they never seem to make any difference to government policy anyway. That, of course, is my Inner Cynic speaking.

What fascinates me about this particular one, however, is the reaction of the US media to it. They’re all up in arms over the poor showing of the US in the standings. Ranking 28th out of 34 nations evaluated. Only 16 years from a major economic catastrophe. What? Blasphemy! The sky is falling! The US never ranks so badly. We’ve gotta do something!

That should, of course, be significant reason for concern to US policymakers.

I suppose, being Canadian and British, I should take comfort that my respective loyalties come in 11th and 9th.

But there’s a bigger fish to fry. Look a few rows down at the country coming in 31st.

Japan.

According to this study, only 5 years from economic catastrophe.

And these figures were compiled before the earthquake and tsunami in northern Japan.

Sweet.

If the world’s third largest economy (the second-largest until China pipped it this year) tanks, we’re all in deep do-do.

I wish the traditional media would stop thinking with their nationalist blinkers on.

2 thoughts on “Time to look at world problems through world lenses

  1. Karl Reimer

    11th for Canada and 9th for UK?

    It wasn’t Canada whose financial house is built out of cards.
    Oh well the rankings did come from a US institution, so it is to be expected.

    Reply
  2. David Kimbell

    I think the study was considering fiscal responsibility not just at the federal level, but also provincial level. And that, of course, is where Canada falls down perhaps. The fed gov’t has solved its deficit troubles in the past by shifting them to the provinces. The UK doesn’t have that problem.

    I also think that such studies are fairly “noisy”. The fact that two countries are two positions apart is pretty insignificant when the noise level is, say, 5 positions!

    Reply

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