Growth is not possible

[Southernguy]

From BBC World Service we read a briefing of a paper from New Economics Foundation, a British think tank.
The paper, quite long (148 pages) can be downloaded from their website.
I find their thesis, that exponential growth is unsustainable in a limited planet is absolutely spot on.
How long can this festival of growing consumption by a small part of humanity can go on?
Even without reading but the first page of the work, which seems to analyze in detail most of possibilities to avoid nature fixed limits, I understand their thesis is absolutely right.
Happiness shall be attained, if ever, by better distribution of goods, rather than by unlimited growth.
One of the quotations I find specially compelling:

Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist.

Kenneth E. Boulding
Economist and co-founder of General Systems Theory

[MulaMan]

Re: Growth is not possible

Growth as measured by?

It is of course possible you account for technical innovation.

Scientists grow artificial meat in a lab:

http://www.popularmechanics.com/scie...h/4212533.html

[Aetius Romulous]

Re: Growth is not possible

They stole it from me LOL

"Impossibleism"

They took 148 pages to state the obvious? I suppose I will have to plug through it now, however just think about it - infinite exponential growth?

What I wonder about is why this concept is so hard for the average person to grasp. Funny.

[gnk]

Re: Growth is not possible

I also would like to mention Japan's problems. How can you have a credit based monetary system that needs constant economic growth and credit/money growth (in order to be able to pay off growing interest payments) when the population stagnates? Doesn't such a system encourage faster resource depletion? And is a stagnant population a bad thing? Can populations grow exponentially forever? Obviously not.

Japan's problem is not a monetary phenomenon - it is a population phenomenon. The monetary issue is a mere symptom.

[swgprop]

Re: Growth is not possible

They stole it from me LOL

"Impossibleism"

They took 148 pages to state the obvious? I suppose I will have to plug through it now, however just think about it - infinite exponential growth?

What I wonder about is why this concept is so hard for the average person to grasp. Funny.

Coincides well with an old post by Rajiv that resurfaced recently:

The Most IMPORTANT Video You'll Ever See

[due_indigence]

Re: Growth is not possible

This problem is larger than Japan and more profound than simply a demographic one. How can you keep generating n+1 to service n? The western banking model is at heart a Ponzi. How do we move from a perpetual motion machine to a sustainability model?

I also would like to mention Japan's problems. How can you have a credit based monetary system that needs constant economic growth and credit/money growth (in order to be able to pay off growing interest payments) when the population stagnates? Doesn't such a system encourage faster resource depletion? And is a stagnant population a bad thing? Can populations grow exponentially forever? Obviously not.

Japan's problem is not a monetary phenomenon - it is a population phenomenon. The monetary issue is a mere symptom.

[gnk]

Re: Growth is not possible

This problem is larger than Japan and more profound than simply a demographic one. How can you keep generating n+1 to service n? The western banking model is at heart a Ponzi. How do we move from a perpetual motion machine to a sustainability model?

I agree. Japan's population example I bring up is but one real world constraint on the current Ponzi Monetary System.

You know what another constraint is? EROEI - Energy returned on energy invested. Energy, the lifeblood of any economy, is getting more expensive.

We should also look at a nation's build-out. Sure, a nation will always build/repair bridges, airports, highways, cities, etc... but eventually, the rate of growth slows down as well. You can't compare the Western World's buildout between the 1950s-1960s and today.

So, energy gets more expensive, populations level off, infrastucture growth slows.... so what does a monetary/financial system do then?

It evolves... it focuses on accelerating consumption by facilitating credit to more and more people... it evolves and creates new financial tools - if you run out of bridges to finance, you start financing gambles (CDSs) on what little real world necessary loans there are... you evolve and coax your government into entering unfair trade treaties that may one day destroy your middle class.... but you don't make the connection that the same middle class you're destroying is owing you more and more money every year. Your greed kills the golden goose, the middle class, so to speak. But no worries, you control the government and it will take care of you.

Sorry for the rant. But it amuses me to watch economists talk their theories of creating and managing money as if money is an independent entity. Money is an abstraction, It's the real world that matters more. The real world changes first... then money's evolution follows.

[Aetius Romulous]

Re: Growth is not possible

I agree. Japan's population example I bring up is but one real world constraint on the current Ponzi Monetary System.

You know what another constraint is? EROEI - Energy returned on energy invested. Energy, the lifeblood of any economy, is getting more expensive.

We should also look at a nation's build-out. Sure, a nation will always build/repair bridges, airports, highways, cities, etc... but eventually, the rate of growth slows down as well. You can't compare the Western World's buildout between the 1950s-1960s and today.

So, energy gets more expensive, populations level off, infrastucture growth slows.... so what does a monetary/financial system do then?

It evolves... it focuses on accelerating consumption by facilitating credit to more and more people... it evolves and creates new financial tools - if you run out of bridges to finance, you start financing gambles (CDSs) on what little real world necessary loans there are... you evolve and coax your government into entering unfair trade treaties that may one day destroy your middle class.... but you don't make the connection that the same middle class you're destroying is owing you more and more money every year. Your greed kills the golden goose, the middle class, so to speak. But no worries, you control the government and it will take care of you.

Sorry for the rant. But it amuses me to watch economists talk their theories of creating and managing money as if money is an independent entity. Money is an abstraction, It's the real world that matters more. The real world changes first... then money's evolution follows.

Ummmm....that was freaking brilliant. Really.

[KGW]

Re: Growth is not possible

Ummmm....that was freaking brilliant. Really.

With all due respect to gnk, it is flat obvious to those who actually see. . .

[Aetius Romulous]

Re: Growth is not possible

With all due respect to gnk, it is flat obvious to those who actually see. . .

Too few people do.
Getting it into words is even more rare. And a well constructed rant...most rare of all LOL.

[Rajiv]

Re: Growth is not possible

The history of the colonial scrip of Pennsylvania is quite educational in this regard -- avoids the problems that you have outlined

The Pennsylvania Pound

Also Colonial scrip

.
.
.
.
.
Colonial scrip, were "bills of credit" created by the government, based on the credit of that government, and this meant that there was no interest to pay for the introduction of money. This went a considerable way towards defraying the expense of the Colonial governments and in maintaining prosperity. The Governments charged low interest when it loaned out this paper money to its citizens, with land as collateral, and this interest income lowered the tax burden on the people, contributing to prosperity
.
.
.
.
The Pennsylvania version of this currency was said to be the most effective, because they controlled the money supply and issued only enough notes so as to satisfy the demands of trade, preventing inflation. In 1938, Dr. Richard A. Lester, an economist at Princeton University, wrote that “The price level during the 52 years prior to the American Revolution and while Pennsylvania was on a paper standard was more stable than the American price level has been during any succeeding fifty-year period.” Pennsylvania established a "land bank" that allowed landowners to borrow scrip with their land as collateral. They could borrow twice the value of their land, half of it representing actual land value, and the other half representing production potential of the land. The loan was to be retired over a set period of years, with the land ownership being restored to the citizen upon payment. When the loan was fully retired, another loan could be taken out.

Benjamin Franklin helped create the Pennsylvania Scrip, and in his autobiography he wrote of this currency:

The utility of this currency became by time and experience so evident as never afterwards to be much disputed

Adam Smith wrote of the Pennsylvania currency in his famed 1776 work The Wealth of Nations:

The government of Pennsylvania, without amassing any [gold or silver], invented a method of lending, not money indeed, but what is equivalent to money to its subjects. [It advanced] to private people at interest, upon [land as collateral], paper bills of credit…made transferable from hand to hand like bank notes, and declared by act of assembly to be legal tender in all payments...[the system] went a considerable way toward defraying the annual expense…of that…government [low taxes]. [Pennsylvania’s] paper currency…is said never to have sunk below the value of gold and silver which was current in the colony before the…issue of paper money.

See also Ellen Brown's new website "Public Banking" and her old website "Web of Debt"

[flintlock]

Re: Growth is not possible

The answer is obvious to anyone who has ever watched a science fiction movie. We will colonize the galaxy! "Infinite growth for an infinite universe!" The latter will be my campaign slogan for President of Jupiter when I have myself thawed out in the year 2096.

[Chris]

Re: Growth is not possible

this is more Lefty nonsense. Defining growth is extremely complex. Of course, we can't have growth based on cheap fossil fuel any more but this is a temporary hiccup in the long history of man's ingenuity.

The economy will continue to contract but eventually it will grow again based around a new model. The timescales for this are large - always have been.

Any time the economy falters the Lefties come out with their limits to growth nonsense. It's short sighted and unimaginative (and dull).

[Aetius Romulous]

Re: Growth is not possible

this is more Lefty nonsense. Defining growth is extremely complex. Of course, we can't have growth based on cheap fossil fuel any more but this is a temporary hiccup in the long history of man's ingenuity.

The economy will continue to contract but eventually it will grow again based around a new model. The timescales for this are large - always have been.

Any time the economy falters the Lefties come out with their limits to growth nonsense. It's short sighted and unimaginative (and dull).

It's also basic math.

But we clearly agree that the current thing is unsustainable, where we disagree is on how to tackle it going forward. One way is to simply ignore it and trust in the certainty of future events being in our favor. Another is to recognize the issue and craft policy and action that deals with it, and provides the framework for a "new model".

Only Americans are "left/right" on issues. The 95% of the planet that does not adhere to American politics has a different set of motivations.

[GRG55]

Re: Growth is not possible

...The 95% of the planet that does not adhere to American politics has a different set of motivations.

And what might those be, pray tell?