Economic and Marketing Information
FOR INDIANA  FARMERS
Prepared by the Agricultural Staff of Purdue University, Lafayette, Indiana
Economic Progress—U. S. A,
What Makes Our
Economy Tick?
by JOHN O. DUNBAR, J. B. KOHLMEYER and
J. CARROLL BOTTUM, Agricultural Economics
WE ARE CONTINUALLY struggling to improve
the way our economic system functions. In
this struggle it is often easy for us to allow the imperfections of the system to overshadow its main
features. The purpose of this article is to set forth
these main features which are responsible for our
high standard of living.
In 1930 personal disposable income (income after
taxes) for the U. S. averaged $968 per person. By
1955 this had increased to $1637, a gain of nearly 70
percent in 25 years. These comparisons are in terms
of constant dollars, so they represent an improvement in real income—in level of living. Each person now not only has more money to spend but
he also works less hours. Thus we have both more
luxury and more leisure.
What will it take for us to continue to have increases such as this?
cornerstones of our economic progress
this has been made possible by the combination
ot circumstances and events peculiar to the development of the United States alone. From among these
we find the three basic cornerstones upon which
°ur phenomenal rate of progress has been built.
First cornerstone—desire and drive for more
things we want for a better life. This desire comes
from our culture. It underlies the reason why our
forefathers set up a form of self government that
allows great individual freedom. Over the years,
ms desire has caused us to make changes and work
ard for more material things for ourselves and our
arnilies.   Rapid progress cannot take place without
this desire and drive.   But it could not have taken
place as fast as it has here without other essentials.
Second cornerstone—our abundance of natural
resources. Some say our temperate climate makes
it possible for us to work harder. We know that
without vast quantities of coal and iron, America's great store of machinery and equipment could
never have been created. Without great underground pools of oil, we would have no use for our
millions of automobiles, trucks, diesel locomotives,
and airplanes. Without uranium, our present development of atomic energy may not have been possible. Without our fertile soils supplied with abundant moisture, our agricultural progress would have
been slower.
Some people point to our great storehouse of natural resources and say, "That is the basis for American progress." But the Indians had these resources
for centuries and they didn't develop them. So. one
must look still further for reasons for our rapid
progress.
Third cornerstone—the economic system we have
chosen. This system allows each individual maximum freedom of choice in production and consumption so long as it is consistent with the common
good. Each of us decides to a very great degree
where we will work. Each of us decides for himself how much of his income he will use for consumption and how much he will save for investment
in things to increase his future income. Each consumer decides how much he will buy of various
goods and services offered. Each individual manager of a business decides how much of each product to produce and what production items and methods to use.