Speaker addresses economic growth at museum business luncheon
WINCHESTER – The Museum of the Shenandoah Valley held its eighth annual Business Forum Luncheon on Wednesday. The event featured a presentation from distinguished economic and finance professor Edwin “Ed” T. Burton entitled “Economic Prospects for the US and the Global Economy.”
Burton, a professor of two very popular economics courses at the University of Virginia and author of multiple finance and economy related books, began his presentation on the subject of economic growth from a historic perspective and its prospects in the future.
“To me, (economic growth) is the most critical issue that faces not just the United States but the entire developed world,” he said. “… There was no per capita growth throughout the Roman days, the Greek days, the Middle Ages. … That doesn’t mean there weren’t rich people. There were, but it was what we call extraction. The way you got rich, was you beat up your neighbor and you took everything he had.”
He explained how these facts worked against the common man, and that actual, attainable wealth was achievable only for a select few. That changed with the advent of the Dow Jones index.
“Never in human history had an average person been able to create that kind of wealth without knowing anything,” he said. “You don’t have to be JP Morgan to make money if the average stock is going up 10 percent a year, which is what the average stock has done since the Dow Jones was first created.”
Burton praised the economic growth created in part by the establishment of things like the Dow Jones and touted the virtues of that growth.
“One of the great virtues of economic growth is that when you have a lot of economic growth, the world doesn’t change for the king, or for the guy at the top, it changes for the guy at the bottom,” he said. “The guy at the top was doing fine in 1500, 1600. He was at the top of society. He has all the food he could eat, he had all the servants he could want, he was great, but the guy who was cutting his grass, he wasn’t doing so well. But by the time you get economic growth that we now have, the guy cutting the grass begins to do well.”
He also said that the everyday person can benefit from economic growth, one of the themes of the presentation, and could do so by simply hiring a decent financial manager.
“(With economic growth) the guy cutting the grass begins to do well,” he said. He begins to have avenues to create wealth without even having great knowledge. He doesn’t have to be a genius, he just has to hire anybody to manage his money. Over a long period of time, there’s no manager so bad that they can’t do pretty close to whatever the average is doing.”
Burton went on to explain how the global economy is very much a copycat system. Once one economy sees a different economy experiencing success, others will try to emulate that. Burton said that there is reason to hope for growth in America.
“I think there is great hope for the U.S. and probably great hope for Japan and if one of these countries begins to let capitalism thrive again, and I think they will – I think the U.S. will – then the other countries will follow. … If we can create a shining example of economic growth here in the U.S., it will not only be the best thing in the world for the people who are traditionally left out of our economy, but will also serve as a beacon for the rest of the world how to improve the lot of their average citizen.”
Contact staff writer Nathan Budryk at 540-465-5137 ext. 155, or firstname.lastname@example.org.