The Malta Independent 18 August 2026, Tuesday
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A matter of perspective

Thursday, 23 April 2015, 10:33 Last update: about 12 years ago

Sometimes, it all comes down to a question of the proper perspective.

Just to give an example: with all this talk of GDP growth we have been having, a longer view (see last week's paper page 3) finds out that the very high growth rate we saw in 2014 has had its precedent: in 2010 the growth rate registered was almost the same if not better at just under 4%.

Or to use another Eurostat set of figures, issued on Tuesday, regarding the GDP, government deficit/surplus and debt in the EU, the government deficit was €168 million in 2014, not much far away from the €178 million registered in 2011 but while the deficit in 2014 amounted to -2.1% of GDP (and hence was well within the Maastricht criteria), the deficit in 2011 was -2.6%.

Again, while government expenditure in 2011 amounted to 40.9% of GDP, it has risen to 43.8% in 2014, only partially offset by the fact that government revenue has risen from 38.3% of GDP in 2011 to 41.7% in 2014.

Hence government debt, far from decreasing as one would expect with a decreasing deficit, rose from €4,809 million in 2011 to €5,417 million in 2014, and only decreased from 69.7% of GDP in 2011 to 68% in 2014.

So, as in everything, it all depends from which perspective one looks at things.

The small, humdrum, task of looking at figures and comparing them brings down to size all the cathedrals of rhetoric that are sometimes made, mostly by politicians and their hangers-on, the flights of optimism and the swallow-dives of pessimism. Such an approach brings a sense of perspective to most discussions and is the best way out of the confrontational rhetoric that many times takes the place of an informed discussion even among the best-informed.

Our public discussions and debates, such as they are, tend to slip to name-calling and mountains of rhetoric instead of shedding light on the issue under discussion.

Instead, if we only were to look at the figures dispassionately, we will see that yes we have registered improvements but they have not been as earth-shattering as is many times claimed. We will see that the preceding people did not do bad at all, everything considered.

And if we were to look with dispassionate eyes on the figures regarding schooling we carry in this issue, we would also see how much we still need to do and how far we are from anything approaching European standards, even though there have been significant improvements over the past years.

The problem with partisan, blinkered, approaches is that not only do they impede the proper and dispassionate view of the situation but they also hinder the right approach regarding the future. A person with a blinkered view can hardly see the real situation as it is let alone what needs to be done to foster a real improvement. Also, most crucially in our insular situation, a blinkered approach will fail to see the situation as it is lived over our horizons, in the big wide world, thinking as we tend to do that all that matters is our small world.

It is thus all-important to keep a sense of proper perspective in everything and, especially in economic thinking, to refrain from jumping to conclusions before we know what the real situation is. 
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