Another way out of recession

 


 

When lack of growth and high unemployment rates are the major problems, what you need is a way to stimulate private initiative that does not cost anything.

 

When spending and investing is not an option, you need a way to stimulate the economy while cutting back on public finances.

 

The problem is that savings and cut backs on public spending create a double dip – even more recession. You need to find a way to avoid the double dip and to accelerate out of recessions without giving gas.

 

Simplicitism offers another way out of recession – a way where savings and cut backs enables growth and employment creation. Intelligent savings and targeted cut backs constitute the core of the economic theory behind Simplicitism.

 

The economy of the modern welfare state is hindered by thousands of inefficiencies created by difficult and complicated rules, special arrangements and unnecessary bureaucracy. Each initiative of removing these inefficiencies creates a positive effect of saved money, saved energy and saved time, which will be used for something else, creating value in society and meaning personal gains for the individuals directly involved, spilling over on nearby and related persons and thereby creating an effect trickling all the way down through the economy.

 

Simplicitism claims these dynamic effects for each initiative on each aspect of society and when initiated simultaneously it creates a wave of dynamic effects throughout society as well as through the economy, increasing private spending enormously, raising demand and thereby production and subsequently creating lots of new jobs within all fields – even within administration, although not with bureaucracy, but with administration of new production, new consumption and new initiatives in the private sector.

 

In recession and crisis simplicitism may be the way to growth and job creation. When politicians have to cut down to balance the budget it often leads to further recessions, also known as double dip, due to layoffs and decreased public spending. If they cut in order to simplify the administration instead of just cutting to save on costs, it will have a two-string effect: On the one hand the double dip effects of further unemployment and less demand – and on the other hand liberated energy, saved time and money for both individuals and businesses, creating dynamic effects all the way down through the economy, leading to growth and increased demand. The second effect is likely to overpower the first one, which makes it an effective tool to create growth while cutting back on public spending.

 

Further readings:

M(2012), Go Simple!, M publications

The European Movement for Simple Politics

Simplicitism - defining article

Another way out of recession

The 10 Principles of Simplicitism

The pseudonym M site

Simplicitism (from Wikipedia)