As recession looks more and more likely, you can't open a paper without reading about our "economic slowdown." I've been thinking about the horrible specter of "slowdown" lately, and have come to a certain conclusion. So, without further ado, I'm going to put up my shortest post ever by asking a simple question.
Is economic slowdown really that bad of a thing? Furthermore, isn't the idea that an economy can constantly grow a fundamentally unsustainable fantasy? Growth is the primary goal of nations: success is measured by annual GPD, and every nation is expected to expand. But what is the ultimate goal of all this? Unlimited economic growth complete with unlimited consumption of resources? (after all, resources are the fuel for growth) This is a paradigm that I've often found troubling reading The Economist and other major publications on the topic: while growth is what every nation strives for, economies can't keep growing exponentially. This could only happen if we had unlimited resources. I believe that the fundamentalist view of the economy (that growth is always good and necessary), much like its corollary in religion, is rooted in earlier times when modern knowledge of the world was incomplete. Until we grasped scientifically that the world is billions of years old, what was to keep us from thinking it's just 6,000? Similarly, economic fundamentalism is rooted in a time when resources indeed must have looked inexhaustible. But we stand at a critical juncture: our human population has more than doubled in the last fifty years; we as a species already consume 84 million barrels of oil a day; etc. (I am planning more in-depth posts on this topic in the future) In other words, we can't keep this up. The economic fundamentalist model has to give.
Please share your thoughts on this: is unlimited economic growth a sustainable concept?
Subscribe to:
Post Comments (Atom)
8 comments:
Perhaps it's my Orwellian sense of pessimism, but I think the very presentation of an unlimited growth concept is a facade. I think the one sustainable attribute of our economical system is an undereducated poor/lower-middle class. The people in society who live without fear because they are not intelligent enough to recognize what they should be fearing are what's fueling the system. People who cannot afford to pay their rent still find the means to amass a bunch of crap from Wal-Mart. That's the beauty of the system. All that is required to keep down the unfortunate is to infect them with an inebriation of impossible dreams. As a result the comfort of the upper classes is forged upon the ignorance and strife of the downtrodden.
One thing that threatens to inevitably corrupt the American system is indeed, as you mentioned, the price of oil. Having traipsed about in Europe I've noticed some fundamental differences in our societal structure. The primary difference is a concentration of population. I was able to walk Florence, Italy from one end to the other in less than an hour. Everything I could have possibly needed to sustain city life was within that walk. That is not a luxury we are afforded in America. We are a very sparsely located people and as such are inextricably bound to the acquisition of oil. As long as that trend continues we are at the mercy of foreign markets. If you ask me the government's current embrace of bio-fuel technologies serves two purposes: it improves the leadership qualities of the United States in the global eye and it threatens the economy of oil countries should we obtain independence of foreign oil. Once American interests in the Middle East have come to fruition you can expect oil to be affordable again. Don't expect that savings to translate to the consumer, however, as our population is now being trained to assume the burden of higher prices.
Seriously though, keep your eye out. People are claiming that the current cooling trend of the planet is a direct result of United States environmental measures instead of a natural occurrence of the La Nina phenomenon. There is also the antithesis to bio-fuels that we're raising the price of corn to levels that directly affect the ability of the third world to eat. In my opinion that's crap. It's the markets that are starving people, not the lack of food. The state of California has the capacity to generate enough food to facilitate the survival of the entire planet. If you really want the third world to eat you would stop eating beef and remove the necessity of feed corn. And really, it doesn't matter how much food you generate if you refuse to distribute it to people.
So, to come full-circle, it is the poor who are made to suffer the consequences of the games rich people play. If supply runs out a war will erupt. Why else are we pushing the blame to China over their failing environmental standards? We need to distract people from the real problems and create enemies. Distraction is the name of the game, and we play it so well. Why eat conscientiously when a red-headed clown is enticing you to mow down on a substance-less burger? It's the same conundrum as forgetting to do your homework because the telly became just too interesting. Really, Orwell was right on when he said "if there is hope it lies in the proles."
The paradigm of unlimited economic growth will need to change, but in many respects may be fundamentally intact in the future. In a certain sense, economic growth by one party comes at the expense of another. In a competitive market, Apple might take customers from Microsoft, or vice versa. In a larger sense, much of the growth of the first world has come on the backs of the third world. Economic growth of this kind may stay largely unchanged.
What will have to change, and what Zach is most likely referring to, is the type of growth that exists due to the depletion of resources and the growth of population. I think that the only logical conclusion is that it is unsustainable and will change.
The choice of how we change the paradigm is the important issue. Do we act with forethought and address resource and populations in advance, or do we keep going until the system breaks? I'd like to think we'll do the former, but I see no evidence that we're heading in that direction. Indeed, incredible barriers exist to this approach, most importantly the taboo of dealing with population issues.
To suggest that maybe, just maybe, people need to stop having so many children is practically unspeakable in this country. Right now, almost any mainstream column or article on environmental issues skirts by this problem as if it is irrelevant. The only mention of the issue is in the letters or comments on the article.
The fact is, population, like resource use and economic growth as a whole, will hit an equilibrium one way or another. But to suggest that we are even close to having a responsible conversation about the topic is fantasy.
Perhaps, in the rosiest of views, we will hit the equilibrium rather painlessly. Maybe resource prices will increase while population growth decreases, and we'll hit the sweet spot with around 9 billion living on a planet with a spartan but sustainable lifestyle. There is a correlation between standard of living and human rights, and decreased population. Many places in Europe and Japan are basically leveling off population-wise. One could imagine that this trend may spread over the globe and we naturally level off. Resource consumption, likewise, may switch painlessly due to basic principles of supply and demand, with a gradual switch to renewables as we hit peak oil. Like I said, this is the rosy view.
It may be just as likely that we push ourselves over an ecological cliff, and if we are lucky enough of us will be around to start over again.
Transitioning to an economic system where both population and resource consumption both exist at a sustainable equilibrium is going to require sacrifice. Religious views espousing large families and no birth control will have to go. People will have to look at governmental population control measures as responsible, not repressive. Beyond population controls, we will have to artificially inflate the prices of environmentally hazardous resources and unsustainable practices. This will require the political branches of our governments to voluntary increase the prices on their voters, a tall order.
I hate to be a pessimist, but I think things will have to get much worse before they get better. Hopefully we can recover from the price of awareness.
I don't see how your point is contradictory to mine. I think we're analyzing different levels. I completely agree with your points from a market-analysis perspective, but my assumption is that the whole system is rather flawed and is doomed for failure from the start. If you consider the concept of a taboo being something that, if engaged upon in universal practice, would equate the non-existence of humanity, our system of consumption is very taboo. Just like everyone on the planet cannot be homosexual, else we'd be three to four generations away from human extinction, so too can we not practice our current trends of consumption in perpetuity. In my mind it works like this: you smoke a cigarette and you can tell immediately that your current course of action will have detrimental consequences if continued for an extended period of time. There are obvious ramifications for our current means of exploiting resources. Is it possible that the economy will regenerate itself when the time comes to find alternative ways to satiate our apocalyptic appetites? Absolutely. Humans are survivors, and people aren't just going to roll over and die because two-ply toilet paper is no longer available. The problem comes from the fact that our necessary steps toward planetary alleviation don't promise to make the infinitesimal few people on the planet rich. I expect things to get a lot worse before they get any better.
Oops, sorry. I did not mean to sound like I was contradicting you. As you said, I agree that our points reinforce each other, but from different angles. I was just throwing in my two cents, rather than posing a response to your comment.
I think we're all basically on the same page with this - we as a species are going to have to address these urgent problems of global warming and population growth, etc. before they blow up on us. The big question, then, is how this slow-down is going to play out. Ruxton, your point is quite provocative, and quite true: the poor bear the biggest burden of global warming. What regions are going to be the most effected as ocean levels and temperatures raise? Places like Bangladesh, equatorial regions, and dry countries like Sudan. I fully anticipate, if things continue on their present course, that there will be mass population movements on a scale never seen before motivated by the dessication of poor people's environments and by the drying up of their food supplies.
Of course, there is something dreadfully unfair about this: these are not the people who have received any benefits through industrialized living, yet they bear the brunt of the consequences.
I do disagree with you on one point, however: I think that a lot of the people on the edge do have a high level of daily anxiety over their conditions. Some of the fiscal irresponsibility coming out of that community is the result of doing anything it takes to distract themselves from the razor's edge by trying as hard as possible to be "normal." This has less to do with intelligence than it does with acculturation and education.
One basic point to take away from this debate is this: we no longer life in a world of unlimited resources. Of course, it's always been this way, but we've never before been in a position where we actually have the ability to pump every gallon of oil from the ground, fish every last fish from the ocean. Population growth and ever more efficient technologies have put us in a rather God-like position on this planet (until things like hurricanes strike, as Katrina so vividly illustrated). Can you imagine what the Amazon basin must have looked like to the first resource-greedy explorers who found it? Inexhaustible. Now, a chunk the size of Connecticut is being gobbled up every year and it's very easy to imagine the last tree being cut down in this century unless we act.
There were huge environmental problems in 1850, of course. But as more and more people move out of poverty and into 1st world lifestyles, these problems become less local and more and more global. A gentlemen from 1900 would have scratched his head if you told him that deforestation of the Amazon would have any bearing on his life besides the plus of having more timber to work with.
I agree with Chris - what is needed here is a complete reworking of our paradigm. Only that will prevent a global catastrophe. Because, yes, the poor will be the first victims if our environment goes sour, but no amount will money will keep the rich above the water forever. We're all in this together.
Yeah, I think you're right Zach, that sources like the economist push the idea that economic growth is always beneficial and necessary too strongly. What I worry about most, with the fretting on Wall Street and elsewhere about hard economic times, is the eagerness with which the Federal Reserve and lawmakers are tampering with our financial systems to try to get us out of any kind of downturn. For instance, the speed with which interests rates have been lowered lately in an attempt to get the economy to suddenly pick up doesn't seem so much about averting disaster as it does about vainly trying to get rid of any unwanted downturns in the natural economic cycles. I think this is not sustainable, and these policies can be dangerous. We are proud of our capitalistic system, but we have to learn to accept that markets ebb and flow. Trying too hard to reduce this process will lead to even bigger, unmanageable problems down the road, I fear.
As far as some natural resources go, we seem to be reaching the limits of growth already. However, it's worth noting that most increase in productivity (i.e. economic growth) over the past century can be traced to technological advancements, which as far as we can tell, there's no ceiling for. For instance, if we can find a way to make hydrogen an efficient fuel source, we'll have a virtually unlimited, clean supply of energy. However, it is true that there are limits to technology, and furthermore, that it's dangerous to rely on new breakthroughs to save us from our past mistakes. I totally agree that slowing down is a good policy.
I think that's a fair assessment Zach. Let me restate it like this: those less educated are more apt to ignore a healthy sense of fear through means of mental tranquilization, whereas the intellectual are more likely to face these fears and keep them at the front of their minds.
After watching Al Gore's "An Inconvenient Truth" I started to ponder the plight of my in-law's. They're a well-off family in a coastal California town. They stand to retire comfortably, if through no other means than their house. If the world's waters rise and their house is now worthless, their life's investment is in shambles. No longer can they live on the California coast for fear of floods and tsunamis, yet what sort of monetary security do they have to underwrite their matriculation? That made me wonder about the situation of all Californians. In Oregon we like to talk, not always jokingly, about the Californians exhibiting locust-like qualities in their atomic-esque spread. What happens if, as the urban myth dictates, California indeed ends up underwater? Or as Maynard James Keenan puts it, we "see you down in Arizona Bay?" Those on the rim are going to travel inwards out of necessity. Tell that to the gun-toting psychopaths adorning the "amber waves of grain" across America. The coastal dwellers will be justified in finding new homes as theirs are no longer habitable. The inland dwellers will be justified in adhering to American social-construct practices of amassing and defending real estate. Consider also that it is upon the backs of the blue-collar grain belt that this country is able to generate the rim-dwelling wealthy. Pandemonium will certainly ensue should a massive shift of populations have to transplant to higher ground. Enter the prophetic vision of Stevie Wonder. Yes, I said vision.
One thing that brings me hope is the sense that nature will have her revenge. If that last Amazonian tree falls the muffled choking of our species will be like a cosmic symphony. The Earth will not sustain anymore than it can. The epic tragedy is that we empathize so greatly with the idea of human value, yet we never even consider that we should keep humans modest so as to not have to infringe on the basic rights of living things.
Ben, looking at those forecasts reminds me of all the work I do with sine wave oscillators. They don't go up forever, rather they return to equilibrium, pass equilibrium towards its negative value, and then the upward trend begins. All things in motion aim to follow this trend. Some older and wiser world markets likely have their sine curve at a very gentle and modest amplitude, so as to not generate too many ripples on the downward trajectory. Americans just don't have it in them to experience "hard times." I say that in quotes because, really, it's a manufactured concept, and the average American family knows hard times, or not at all. Society does wonders to askew our perspective. One thing that gives me some inkling of hope is a rocket ship model. A rocket ship speeds towards the heavens, always wanting to complete its physical expectations through the old adage "what goes up must come down." However, before that last drop of rocket fuels is spent, it breaks the atmosphere and is picked up by a new cycle: the circular orbit of a celestial body. If we, as a society, can find a way to alleviate the downward trajectory of our economic cycle through innovation, we'll be all the better for it. But you're right. The Federal Reserve is doing no one a favor, they're only making ripples to fuel their illusions anyway.
Post a Comment