The anti-growthers are barking up the wrong tree. Whether or not a society has a sustainable economy based on renewable energy and recyclable materials depends entirely on regulations, not economic growth. The focus needs to be on convincing people to support green regulations and a green-energy economy.I'll get to the points about a "green-energy economy" later. However "anti-growthers" I will address now. I am not "anti-growth", rather I simply don't believe in it, have faith in it, and have never seen any convincing cases that it is possible into infinity. We are seeing limits to growth all around us everyday.
Fact is we will create GDP growth transforming to a green economy whether we want to or not. Some ways to go greener: build mass transit systems; subsidize broadband internet (wired and wireless) to reduce need for high-energy-consumption travel; build green-energy power systems; change from combustible engine cars to electric cars; develop driverless cars which will change the nature of transportation; etc. All these activities create economic growth.
Whether we want to or not? Not quite. Utilizing all types of energy available and skirting regulation while central banks have kept monetary policy in emergency response mode to supposedly entice borrowing and drive liquidity hasn't exactly been working too well. It's now 6 years since 2008 and we're still "recovering".
As for the initial suggestions: The major problem I see with most of them is that you believe we can both simultaneously grow from our already engorged state which will require even more energy and resource consumption from that which we currently consume (it's been 100% proven there is a direct correlation to energy consumption and GDP growth) while also changing from what is a very dense high return energy source to a more diffuse one. The other problem is that technological changes at the top do not alter the fact that our entire technological base is founded on oil. Don't get me wrong, I'm very much in favour of sustainability, but real sustainability, you know the kind that.. sustains. Forever.
So for instance you mention electric cars: first of all electricity is not a power source, it must be generated from another power source and I don't know if you've compared the costs and power generation capacity of wind farms, or solar panels, but they certainly will not be powering everything we have now and the addition of 800,000,000+ electric vehicles all running on the grid. Second you are not accounting for the materials and energy consumption that is going to be required to replace 800,000,000+ cars on the roads today. It takes 7 gallons of oil to create a tire, 3 times the car's body weight in oil to produce a whole car. We have to mine metals, pave roads and run regular maintenance on all of it. We can barely keep up with road deterioration as is.
You're correct however in that "all of those activities create economic growth", that does not mean however that the economic growth generated by those activities will be enough to actually grow the economy in aggregate.
So like evolution in electronics (smart phones and TVs, for example,) there is a process of creative destruction going on that puts an emphasis on energy efficiency. As long as it's done responsibly (recycling materials) it is not only positive, but necessary. We need technological advancement to go green. For example, if we build arrays of wind turbines across the country and find ways to make them more efficient, we need to rebuild or upgrade them. Same with solar power arrays. Same with cars, homes and buildings.
GDP (economic) growth means wealth creation. Wealth is created by people getting a return on their savings and investments (compound interest.) As long as all segments of society benefit from wealth creation, wealthier is always better. It provides the means by which a society can go greener. It provides the means by which people can realize their potential. Since health and education spending are measured as a percentage of GDP, GDP growth means we will have more money to invest in these and other areas.No, wealth is not created by people "getting a return on their investments" with compound interest. In fact compound interest, along with fiat currency (which represents debt or "wealth from the future"), and fractional reserve banking are all large parts of the problem which put society into a situation where infinite economic growth is required to service the status quo. Mike Maloney does a great series on how the modern monetary system actually works, I suggest you look at it. But for the purposes of this response I will say wealth is a return on energy invested. The more energy you get in return for the energy you expend the wealthier you are. We use currency to represent this stored energy.
The problem with compound interest and debt based currency is that because there is always more interest owing than there is currency in existence due to the fact that all currency is loaned into existence and has compound interest attached to it is that we make the assumption embodied in our monetary system that the future will always be larger than the past. We assume that we will always be able to increase production, exponentially, to pay off in real wealth the interest + principal of the outstanding loans and when that can't happen the whole system goes into a tailspin.
What precipitated the 2008 financial collapse? Oil at $147 / barrel and gas prices on the frontpage of every newspaper. The cost of everything skyrocketed, people had to use credit to afford their gas bills, and eventually when the credit ran out the missed payments began and the whole house of cards came down. Was the issue the banks? Yes, but it could have gone on longer had oil prices not dampened consumption and created a deflationary situation. Though had the banks acted proper "economic growth" would be nowhere near what we claim it is today, the overblown housing market created wealth out of thin air -- for awhile. As it is today too with the central banks and their ultra low interest rates, expensive energy, limited credit. Our inability to really get economic growth going is a direct result of an energy crisis, not a shortage but a crisis in the sense that we have it but it is becoming very expensive to produce and very expensive to consume due to the shrinking energy return on energy ratio we are getting for production.
So while we may be "swimming in oil" as the latest buzzword says, we're drowning in costs, and the central banks are trying to offset this by "creating wealth" through loans and returns to investors but currency itself is not wealth, its just paper, and printing more paper or creating more digital signals does not put food on tables - cheap energy does. We can print all the currency we like but the reality is it does not change our actual balance of excess energy which we utilize for economic production. The more energy we spend producing energy the less energy is available for "growth". It's simple math that if growth requires production of more energy than we had before, and our excess energy (that energy we do not spend extracting more energy) is shrinking, then growth is going to likewise shrink too. Contraction.
The real problem is free-market social Darwinism that allows a small minority of oligarchs (whether "democratic" or fascist) to hog up most of the wealth.
The anti-growthers don't realize their alternative to economic growth is some form of communism (full government control over the economy.) Historically, the cause tends to get lost in the revolution and a totalitarian dictatorship is created.I don't know if you've realized this or not, but we're pretty much already there. All of the "democratic nations" have fully armed militarized riot police trained to put down the coming protests and riots as the economic situation around the world worsens. We saw them at the G20 in Toronto, we saw them in Ferguson recently. The oligarchs you speak of know that a major economic contraction is already in the works and are simply kicking the can down the road long enough until they're prepared to handle the result. It's not like it's going to be a voluntary thing either though, I am not against growth - I've simply accepted the reality that it is a mathematical impossibility. It's not going to be optional, but the further pursuit of it is only going to lead us into more dangerous territory. The more expensive the world becomes due to diminishing energy supplies, the more shortcuts were going to start taking, the more activities like fracking, and oilsands become appealing.
Another positive about GDP growth is that it created wealthy developed countries which have negative population growth. They only way to stop runaway population growth is to raise living standards across the globe and increase immigration to developed countries.At this point I have to question if you really understand the concepts I'm talking about. It created wealthy countries during the cheapest energy era the world had ever seen. It's very easy to grow and raise living standards with lots of plentiful cheap energy, but its a much different ball game going from cheap energy to expensive energy. Yes, wind-farms and solar panels - relative to conventional oil - are very expensive and provide poor returns. They are also not nearly as mobile, depend on an oil based supply chain and advanced oil based technologies like micro-computers. They are not truly "alternative energy" but rather "derivative energy" as their production and operation depends entirely on an oil based supply chain.
In order to accomplish this we need to use the centrist mixed-market economy — which created modern living standards in the post-war era — on a global scale (it's a balance between free-market capitalism and communism.) Communism is not an option. Free-market ideology creates a balkanized globe and regulatory race to the bottom which is the cause of all our problems, economic and environmental.In the post-war era energy was cheap, currency was sound and based on real money, and Ronald Reagan hadn't happened yet. The world economies today are a much different beast and also rely much more heavily on financial magic and market fraud to "balance the books". The system as a whole is much more unstable, much more dependent, and much less resilient. In the post-war era "farming" was still a viable career, today most people get their food from the grocery store. Comparing the two is like apples and oranges and the thing about economic growth is, if you don't grow then you're contracting. We can't go back in time and "do it right", we have a huge economy now and much of it is based on fraud and junk bonds and it must grow. The emergency financial measures, currency wars, trade wars, and resource wars that have broken out over the last 20 years are growing evidence that those with a vested interest in the world's resources are getting antsy. We'll likely blow ourselves up into instability long before the economic impacts take their logical course.
"How exactly do you produce more without utilizing more resources to do it? It's pretty simple, you don't."Physical goods can be produced without using more resources if they are created using renewable energy and recyclable materials.Of course, many of the goods and services being created are information based, which use very few (potentially renewable) resources in their creation, reproduction and transportation.
Actually, the resources required to run "the internet" are massive. Multitudes of servers, wires, and electronics which are produced, and reproduced at an alarming rate - giant server farms on the electricity grids. The internet is the single largest energy and resource consumer mankind has ever created.
What we really need to focus on is uniting activists around the globe to demand action that representational governments are unwilling to take (because they represent oligarchs, not people.)
Whether one believes in economic growth or not, the people need to unite to demand that: a) we put the right regulations in place to create a sustainable economy; b) we tax the rich (income taxes, wealth surtaxes, estate taxes, financial transaction taxes, etc.) so we can make the necessary investments to create a sustainable economy.
I think its better to focus on what kind of regulations and investments are needed, because any which way you slice it, they are sorely needed.I agree. The problem is that under the current economic model there is simply not enough capital to make the transition - the cheapest, biggest return will always win. Due to the dependence of advanced energy sources on older energy sources and an oil based supply chain it is incredibly unlikely derivative energy sources can become cheaper in terms of energy invested and energy returned than the energy and materials upon which the technology is based on and which have a much better rate of return. The fact that we're even willing to pursue projects like oilsands whose returns are dubious at best shows where we are in this energy story and how desperate we might get. We're not going to be making smart decision, we're going to be making what appear to be the cheapest solutions and that is reinforced by a GDP economy which demands growth. When a company needs to enact cost savings for growth they are usually cutting corners, or over working people, reducing quality, etc. This is not an avenue towards a better future, but rather a worse one.
Absolutely we need to go after the oligarchs. They are the bankers putting compound interest on the currency we borrow into existence and which we must pay back with our hard earned labour. I'm not exactly sure where you got the idea compound interest is providing returns for anyone but the oligarchs, for compound interest is one of the ways they rob us. I'm all for a sustainable economy, but sustainable and growth are not going to go hand in hand. Nothing sustainable grows forever, nothing.
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Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.
Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.