17 ms·

Growth as a result of consumption is destructive. We need to find ways to 'grow' our economy without increasing consumption. For example, measure growth by ho

Growth as a result of consumption is destructive. We need to find ways to 'grow' our economy without increasing consumption. For example, measure growth by how people are becoming more educated. If people could live healthily and intelligent and only work 10 hours a week until they were 100, wouldn't that be better than being able to buy a new car every year? Or a 5000sq house with the latest big screen tv? I believe (or rather, I pray) that we have hit peak consumption which will lead to this problem forevermore. We need to find new ways to improve ourselves than shopping more.

weisser 10y ago
Exciting to see that this is the top comment (at least for now) because I think this is the sort of attitude and vision for the future that will solve many of the health problems in this world. I'm also very excited by YC's UBI experiment. People should be able to not worry about basic needs and be able to focus on enriching their lives and, by doing so, the world around them. I encourage people to check out the entry for the Civilian Conservation Corps (https://en.wikipedia.org/wiki/Civilian_Conservation_Corps https://en.wikipedia.org/wiki/Civilian_Conservation_Corps) - few people realize how important programs like this can be.
- jackcosgrove 10y ago
  It would seem to me that UBI would increase consumption, and reinforce our perceptions of success.
  - HammadB 10y ago
    Agreed, something has to be done at a cultural level as well and I think this starts with parenting and schools.
  - mason55 10y ago
    The idea is that with UBI people don't need to work 40 hours per week at a miserable job if they don't want to. This in theory causes prices for stuff like McDonalds to go up which should reduce consumption. In addition, people are free to pursue things like further education and the arts that are much harder when you're working two jobs to put food on the table.
    - RyanZAG 10y ago
      UBI comes from tax money though. If the idea behind UBI is that people don't need to go work, and won't go buy McDonalds anymore, then tax income is going to plummet. If tax income plummets, what pays for UBI ? UBI can only succeed if people continue to consume, preferably at higher levels than currently, which would allow others who want to live a life at a higher standard to sell things to UBI recipients, who can then be taxed and support everyone else on UBI. If UBI encouraged too large a portion of the population to pursue non-taxable income (say, making art and games and giving them away for free because they don't need money), then UBI would collapse from lack of income. Especially so if that art is given away freely to other countries over the internet. So it's a fine line that is probably a lot more complex than people give it credit. There's certainly no guarantee as to what the results of UBI would be, and no guarantee that the medicine won't be far worse than the symptoms. EDIT: Even if you assume that a UBI could survive if it decreased with a fall in taxable income from a policy and livability perspective, if a person on UBI received $100 one week, and then had it drop to $75 the next, he would get a major shock and public opinion of a UBI would fall apart. You could print money to make sure UBI never falls, but if UBI is going out to the entire population, the amount of money needed would be enormous. That much money added to a system without an increase in real demand (people on UBI would still buy the same stuff), could easily cause hyperinflation. So another constraint that UBI has and I've never heard anybody mention - UBI can never decrease, even if tax income decreases. Plus there's no way anybody could trust politicians to manage something that complex. UBI practically demands a complete restructure of government, society and the economy. Instead of being a 'patch' as many have described, UBI is closer to 'The World 2.0'. It would be the most incredible Second System Syndrome ever seen.
      - zackmorris 10y ago
        While this is true mathematically, I prefer to think about the opportunity cost of not having a UBI. I (like perhaps many people on HN) basically wasted my 20s trying to make rent while I worked on my shareware game company. I basically failed at that and all of that code went obsolete before it earned me income. Had I had a relatively small UBI of perhaps $12,000 per year, I could have met expenses long enough to get ahead of the curve. I wouldn't have spent that time burned out and getting sucked into dead end $20,000 per year jobs that took all of my time and energy. So for me, not having a UBI and throwing away a rather prolific 20 something probably cost the US GDP growth whatever my business might have contributed for a decade, say whatever a typical game developer salary might be (perhaps $60k/yr), call it $600,000. That could easily be 2, 4, 10 times that much if we grew enough to hire other employees. By not investing in the workforce like the country did with public works before the information age started in 1980, my generation (gen x) lost out on at least a 5x rate of return. My struggles happened just before Prosper and Kickstarter got big, so I ran up staggering credit card debt. Had we chosen a more progressive route, even at a 20% tax rate I would have paid the government back what it paid me, with the bonus of life sucking a whole lot less. I think a UBI might be one of the few things that can raise the 10% startup success rate because it attacks burn rate directly. It would also allow startups to focus on things more meaningful than video games and social media apps because it wouldn’t just be about trying to get enough F.U. money to get left alone anymore. I had always planned to save enough to be able to work on AI and alternative energy, and now with consistent hard work I have a chance of doing it, but with a middle aged realism that is just not helping my motivation. To be 20 again and told “go do all the things” is one of my deepest wishes and I hope it happens for future generations.
  - Ericson2314 10y ago
    Hierarchy of needs; cross fingers
SilasX 10y ago
The problem is that the media almost always use this implicit syllogism: "70% of GDP is consumer spending. Therefore, the economy depends on consumer spending. Therefore, we need to goose consumer spending if we want to help the economy."
- acqq 10y ago
  No, the problem is that the whole western economy can "logically" function only based on "growth" as in "more consumption, more production every year." But math is not on our side: http://www.informationclearinghouse.info/article25458.htm http://www.informationclearinghouse.info/article25458.htm
  - jomamaxx 10y ago
    'Growth' can continue every year from now until infinity. The capacity for human innovation is unlimited.
    - erelde 10y ago
      "It's not because every human has died that I will die too." I need proof that human innovation potential is unlimited.
      - marvin 10y ago
        Well, obviously not unlimited in the mathematical sense (the ordering of elementary particles in the visible universe is finite), but there is a lot of stuff that the laws of physics allows which we would like to do, but are currently incapable of doing. Just to name a few: Ensure sustainable energy production, halt and reverse global climate change, eradicate all disease and suffering, make aging and death optional, ensure that working for a living is optional, allow all humans the possibility of ethically experiencing most experiences and capabilities available to the richest 0.01%, cure all physical and mental disabilities and enhance human bodies with new senses and physical capabilities, create easily-available artificial intelligence which is at least as capable as the smartest human alive and acts in humanity's interest, and so on.
TaylorAlexander 10y ago
Absolutely agree. Check out videos on youtube under the search "New Economics" for more info about this. There's some great channels (like the New Economy Coalition) with full lectures, but check out this short primer video on the concept: https://www.youtube.com/watch?v=FrIhloNEwT8 https://www.youtube.com/watch?v=FrIhloNEwT8 See my comment about this in another thread for more links: https://news.ycombinator.com/item?id=12243080 https://news.ycombinator.com/item?id=12243080
whenwillitstop 10y ago
The problem is that we live in a world governed by natural forces, and not by spiritual revolutions.
- Normal_gaussian 10y ago
  Can you elaborate on this? What are you classing as natural forces? Spiritual revolutions? Such a small comment is so easy to dismiss because what you mean is not clear and those of us reading it can dismiss it as trite, obvious, or irrelevant without consideration or if we do give it consideration we are at the mercy of our own interpretation of the words used - either way it makes something you obviously cared enough about to write a null contribution to the conversation.
- ZenoArrow 10y ago
  Which natural forces are you referring to? Are you sure that they are natural forces (rather than learned behaviour)?
  - nine_k 10y ago
    Game theory, mostly.
    - ZenoArrow 10y ago
      If game theory is natural law then it should apply to all humans, regardless of background. How does it apply to the groups of people who aren't driven by amassing material possessions (hunter-gatherer tribes, monks/nuns, etc...)?
- tunap 10y ago
  You mean 'unnatural forces'? As a species we have made great progress in mitigating natural forces. Not utopian, but there is enough resources, logistics and actors to feed the entire world, if a relative few didn't have to take all they can sequester for themselves. I see more forces pertaining to greed (infinite inflation racket, regulations as barriers, control of *-opolies, artificial shortages boost prices) holding back humanity.
icebraining 10y ago
Robert "Bobby" Kennedy's 1968 speech is appropriate: https://www.theguardian.com/news/datablog/2012/may/24/robert-kennedy-gdp https://www.theguardian.com/news/datablog/2012/may/24/robert...
- blazespin 10y ago
  That is incredibly uplifting and deeply deeply disturbing at the same time.
- yolesaber 10y ago
  Thank you so much for this
psadri 10y ago
Our culture of consumption has roots in our biological drives. We are more attractive reproductive mates if we have more material resources. Therefore, a bigger house >> a small house, etc. although, as a side note, we seem to have lost the direct connection between the two -- people continue to want fancy stuff well past their reproductive age. For the world you want to become true, something else must become biologically attractive.
- herval 10y ago
  That sounds veeeery far-fetched. How about societies where material resources aren't the main goal? How does that explain poor people having more babies? Is there any known correlation between "having more stuff" and reproduction at all? If any, the somewhat accepted reproductive drive is "passing down your genes" - and people/animals/any creature that displays more "power" tends to attract more mates. And power doesn't translate to material resources in most cultures/societies/animal races...
  - psadri 10y ago
    Material resources are the most obvious way to demonstrate you have "power". As for poor people with many babies -- it could be due to lack of access to birth control, or sometimes an insurance against high infant mortality rates. When your livelihood depends on how many hands are helping you in the farm, you want to make sure you have at least X babies.
    - bballer 10y ago
      You both missed the most obvious answer as to why poor people generally have more children; poor people typically have more time on their hands and encounter boredom more frequently, thus they fill this time with intercourse. Couple this with a lack of birth control and viola, more children. Of course in the context of farming having more hands around is essential to survival, in most other cases though more children will further impoverish the couple.
      - 10y ago
ArkyBeagle 10y ago
Most consumption doesn't involve big houses and TVs. Those exist as signal items mainly because they're paid for with debt, which increases the amount of money in circulation. Education is now a good that also increases debt, with mixed results. Throwing money at it does not change the predictive value of the standardized tests used to "ration" education. Without increases in the money supply, there simply won't be growth. There's only so much the central banks and government can do; at some point, people either spend or they don't. The one thing that can be done is to try to adjust inflation upwards, which increases the risk of lazy investments.
vixen99 10y ago
'we have hit peak consumption'. I'm wondering - who is the 'we' you have in mind? Folk across vast areas of the planet might be at a loss to know what you're on about.
paulpauper 10y ago
not sure how a functioning economy can exist without consumption of some form.
- herval 10y ago
  Likewise, people were very skeptical about centralized currency/printed money when it was first introduced. Or if you want something more recent - skeptical that industry would ever surpass agricultural production, or services would ever overtake industrial goods, without destroying economy. Doesn't mean it _can't_ happen...
  - nine_k 10y ago
    If you look at what fiat money had become in past, e.g. Germany of 1920s, you'll see that the doubts were quite founded. Even if you take a look at most important modern currencies, you'll see how much trickery is involved (quantitative easing, etc).
tcbawo 10y ago
Other than spending money, there is only saving and investment. Some believe that our current lack of demand is caused by too much money chasing too few investments.
acd 10y ago
This is very true its destructive to the environment to just be zombie consumers buying more "stuff". If you would be given carbon emissions as a currency and then you could choose to spend it. Products may be different. A long lasting product would be cheap and a short lasting product would be expensive.
- superuser2 10y ago
  Product consumption isn't anything special these days, it's all about services now.
- tunap 10y ago
  Additionally, how about giving some weight to packaging; especially the ubiquitous petro derived variety.
deleted 10y ago
[deleted]
superuser2 10y ago
Slightly off-topic, but since you brought it up. A 40" TV is, like, $300 [0]. The average American watches 5 hours a day [1]. Replace your TV every year, that's $0.16 per hour of entertainment. I probably pay more than that in bus fare and late fees to use the public library. Big-screen TVs don't belong on the list of excessive consumption items anymore. They are incredibly cheap and deliver enormous utility relative to expenditures that get drastically less hate, like a data plan for even the cheapest smartphone, plane tickets/vacations in general, picking the crossover instead of the compact sedan, picking the very slightly nicer apartment, etc. [0] http://www.bestbuy.com/site/tvs/led-tvs/pcmcat193400050018.c?id=pcmcat193400050018 http://www.bestbuy.com/site/tvs/led-tvs/pcmcat193400050018.c... [1] http://www.recode.net/2016/6/27/12041028/tv-hours-per-week-nielsen http://www.recode.net/2016/6/27/12041028/tv-hours-per-week-n...
- susan_hall 10y ago
  I think "TV" is a stand-in for "watching TV". That is a common sense reading. And what do you watch on TV? Your statement is correct if you only watch broadcasts, but that is only 9% of the USA public. Almost 90% of USA households have cable. The cable is a monthly fee. That changes the economics that you suggested. In the UK, the economics are slightly different, but recall that UK taxpayers pay a fee to the BBC.
  - matthewmacleod 10y ago
    Uk taxpayers do not pay a fee to the BBC. Every household that uses equipment to receive live broadcasts much purchase a TV license, but that's quite different.
    - richthegeek 10y ago
      That's a semantic argument really. The license fee funds the BBC, and the BBC are the ones who care about collecting it (even if at arms length with the official 'enforcer'). Every argument about the future of the license fee, or not paying it on an individual level, explicitly state the BBC as the benefactor of this fee. The fact that it's tied to equipment capable of receiving live broadcasts (until September) is not much more than a clever workaround.
jganetsk 10y ago
Instead of measuring GDP as our metric, measure how much basic income can be generated without causing inflation. Rising basic income levels with stable GDP and stable prices (or even falling) is utopia.
- nercht12 10y ago
  Agreeable, in theory at least. The fact is, though, when one person gains, someone else loses out, in this case, biz owners. Corporate execs aren't going to raise wages and keep prices the same, not unless they have some means to compensate for it (Hello, McDonalds!)
narrator 10y ago
Keynesianism says that spending money on anything is good, no matter what. War is good, make work projects that do nothing are good, spending money on frivolous consumer goods is good, etc. Austrian school recognizes that investing in productive capital that lowers the cost of production and resources consumed in production is actual real economic progress. For example, let's say you have an island with coconuts. If you pay everybody $100 to go out and buy coconuts, the price is going to just go up. If you pay them $100 to plant more coconut trees or make tools to harvest them more efficiently, there are going to be more coconuts and the price is going to go down. Keynesianism would say the two are equivalent economically because AD = C + I + G + (X-M) and in this equation C and I are perfectly interchangeable. If you want to read the long version of that I'd suggest Hayek's critique of the paradox of savings: https://mises.org/library/hayek-paradox-saving https://mises.org/library/hayek-paradox-saving
- TheOtherHobbes 10y ago
  Hayek is one of the reasons we're in this mess, so - coconuts or no - it's hard to believe that more Hayek is a solution. I don't recall Keynes saying any of the things you claim he said. He actually said this: "If the Treasury were to fill old bottles with banknotes, bury them at suitable depths in disused coalmines which are then filled up to the surface with town rubbish, and leave it to private enterprise on well-tried principles of laissez-faire to dig the notes up again (the right to do so being obtained, of course, by tendering for leases of the note-bearing territory), there need be no more unemployment and, with the help of the repercussions, the real income of the community, and its capital wealth also, would probably become a good deal greater than it actually is. It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing." Perceptive readers may notice a certain hint of irony in the above, which Austrian economists - being literally minded, on the whole - may have missed.
  - shitgoose 10y ago
    I am also missing on the irony here. Could you, please, elaborate?
golemotron 10y ago
> We need to find ways to 'grow' our economy without increasing consumption. For example, measure growth by how people are becoming more educated. That isn't the same as growing the economy. Changing the definition of a word doesn't not change the reality of the thing it refers to. In this case, economic stagnation due to lack of growth.
edcastano 10y ago
I couldn't agree more, and am ecstatic that there are other like minded people. I believe my response to this Quora question, is one way to get this outcome. Would be curious to get your reaction to the idea. https://www.quora.com/In-your-opinion-what-should-the-United-States-change-about-its-tax-structure https://www.quora.com/In-your-opinion-what-should-the-United... The only good tax…a tax on “bads” The U.S. federal government first imposed a [temporary] personal income tax in 1861, in order to pay for the Civil War. The tax was later made permanent in 1913. In other words, our country is stuck on a nineteenth century tax model, collecting 95% of our revenue from labor and investment. I believe government slaps taxes on income and investment out of sheer momentum. If all you have is a hammer, everything looks like a nail. If we were designing a tax framework from the ground up, it would surely look different. In its simplest form, I’d say it would entail taxing “bads” instead of taxing “goods”. Let me explain.Of the $2.4 trillion in federal tax receipts collected every year in the U.S., 95% comes from taxing labor and investment. These are activities that generate social benefits; jobs, goods, and technological progress. Economists call these positive externalities, but we can simply call these “goods”. On the flip side, less than 2% of the $2.4 trillion in federal revenue comes from taxing—waste, pollution, and resource depletion—activities that generate social ills like obesity, heart disease, cancer, urban sprawl, materialism, and resource wars. Economists call these negative externalities but we can simply call these “bads”. A sensible tax policy would entail taxing “bads” instead of “goods”. Today we have it backwards, with the bulk of the federal tax burden, (95%) falling on taxing “goods” like labor and investment, instead of “bads” like resource depletion, waste and pollution. Some will argue that such a system would be regressive and punish those that can least afford it. However, this system can be combined with a monthly federal stipend of a couple of hundred dollars for every single man, woman and child in the country to make the system progressive. In this scenario, those who save energy and resources, make money, and those that waste it, pay. Nonetheless, everyone, rich or poor would have a strong incentive not to be wasteful. More importantly, it would eliminate the disincentive to work. This approach would help solve some of our nation’s largest problems. People would be healthier since the prices we pay for food would reflect the energy and resource intensity of meat vs. produce…thus leading people to consume more produce. We’d start seriously investing in energy efficiency, not because of government mandates, but because it would make financial sense. The approach might even help put our fiscal house in order since it would imply eliminating corporate welfare and all subsidies, including those for clean energy. Market forces would take over without all the loopholes that inevitably skew our personal decisions and ultimately the national economy. Families would have a strong incentive to save and invest, instead of waste and consume, reversing a century of falling savings rate. It might even help reverse the last 60 years of cultural decay…combating materialism, consumerism, and the decline of the family. I won’t argue at what level our economy should be taxed. My point is that if we will have any tax what-so-ever, it should not come from the work of; the policeman protecting our streets, the agent insuring our home, or the entrepreneur creating new industries and jobs for society. If nothing can be said to be certain except for death and taxes, then let’s use taxes to help us live longer, richer lives, and leave a world for our children that is not worse off than the one we found. --------------------------------------------- --------------------------------------------- This led me to create this site http://www.writegreen.org http://www.writegreen.org. Might have to give is 30 seconds or so to load (I've got it hosted on slow Heroku tier) The idea was to empower citizens to use their own philosophy to advocate sustainability with our politicians. The ideas is, change your politicians, not just your light bulbs.
refurb 10y ago
Growth as a result of consumption is destructive....For example, measure growth by how people are becoming more educated." You realize that consumption includes education, right?
- KMag 10y ago
  But the measurement of consumption is in currency, typically USD. If you get that education via a free MOOC, then its contribution toward consumption measures is the cost of the electricity and bandwidth you used... essentially zero.
jeffdavis 10y ago
Great comment. I'd like to see this idea developed a little more thoroughly -- any suggestions?
flukus 10y ago
> I believe (or rather, I pray) that we have hit peak consumption which will lead to this problem forevermore. We need to find new ways to improve ourselves than shopping more. I think if we had more time we could certainly be consuming more, at least it's my limiting factor (besides money). Imagine if we halved the work week or invented a pill that would let us survive on 1 hour sleep a night, that creates a lot more hours of consumption.
jldugger 10y ago
> For example, measure growth by how people are becoming more educated. If people could live healthily and intelligent and only work 10 hours a week until they were 100, wouldn't that be better than being able to buy a new car every year? At least on the margins, nobody is doing this. And I doubt it's because the GDP numbers says not to.
jomamaxx 10y ago
"Growth as a result of consumption is destructive. " I'm sorry, but this is completely ridiculous. 'Consumption' is the primary driver of economic growth, and it will always be thus. Without 'consumption' there is literally no economy. If people want to work 10 hour weeks, they can do that, though I should point out, most kinds of work activities, especially the high value ones, don't work that way. Better to work 40 hour weeks for 10 years, save everything, and retire. Surely we need to find a way to clean up after ourselves and solve the problem of fewer resources and more garbage, but in general 'consumption' is good, or else there is no 'work' and no 'jobs' - even 10 hr/week jobs.

weisser 10y ago

Exciting to see that this is the top comment (at least for now) because I think this is the sort of attitude and vision for the future that will solve many of the health problems in this world. I'm also very excited by YC's UBI experiment. People should be able to not worry about basic needs and be able to focus on enriching their lives and, by doing so, the world around them. I encourage people to check out the entry for the Civilian Conservation Corps (https://en.wikipedia.org/wiki/Civilian_Conservation_Corps https://en.wikipedia.org/wiki/Civilian_Conservation_Corps) - few people realize how important programs like this can be.

jackcosgrove 10y ago
It would seem to me that UBI would increase consumption, and reinforce our perceptions of success.
- HammadB 10y ago
  Agreed, something has to be done at a cultural level as well and I think this starts with parenting and schools.
- mason55 10y ago
  The idea is that with UBI people don't need to work 40 hours per week at a miserable job if they don't want to. This in theory causes prices for stuff like McDonalds to go up which should reduce consumption. In addition, people are free to pursue things like further education and the arts that are much harder when you're working two jobs to put food on the table.
  - RyanZAG 10y ago
    UBI comes from tax money though. If the idea behind UBI is that people don't need to go work, and won't go buy McDonalds anymore, then tax income is going to plummet. If tax income plummets, what pays for UBI ? UBI can only succeed if people continue to consume, preferably at higher levels than currently, which would allow others who want to live a life at a higher standard to sell things to UBI recipients, who can then be taxed and support everyone else on UBI. If UBI encouraged too large a portion of the population to pursue non-taxable income (say, making art and games and giving them away for free because they don't need money), then UBI would collapse from lack of income. Especially so if that art is given away freely to other countries over the internet. So it's a fine line that is probably a lot more complex than people give it credit. There's certainly no guarantee as to what the results of UBI would be, and no guarantee that the medicine won't be far worse than the symptoms. EDIT: Even if you assume that a UBI could survive if it decreased with a fall in taxable income from a policy and livability perspective, if a person on UBI received $100 one week, and then had it drop to $75 the next, he would get a major shock and public opinion of a UBI would fall apart. You could print money to make sure UBI never falls, but if UBI is going out to the entire population, the amount of money needed would be enormous. That much money added to a system without an increase in real demand (people on UBI would still buy the same stuff), could easily cause hyperinflation. So another constraint that UBI has and I've never heard anybody mention - UBI can never decrease, even if tax income decreases. Plus there's no way anybody could trust politicians to manage something that complex. UBI practically demands a complete restructure of government, society and the economy. Instead of being a 'patch' as many have described, UBI is closer to 'The World 2.0'. It would be the most incredible Second System Syndrome ever seen.
    - zackmorris 10y ago
      While this is true mathematically, I prefer to think about the opportunity cost of not having a UBI. I (like perhaps many people on HN) basically wasted my 20s trying to make rent while I worked on my shareware game company. I basically failed at that and all of that code went obsolete before it earned me income. Had I had a relatively small UBI of perhaps $12,000 per year, I could have met expenses long enough to get ahead of the curve. I wouldn't have spent that time burned out and getting sucked into dead end $20,000 per year jobs that took all of my time and energy. So for me, not having a UBI and throwing away a rather prolific 20 something probably cost the US GDP growth whatever my business might have contributed for a decade, say whatever a typical game developer salary might be (perhaps $60k/yr), call it $600,000. That could easily be 2, 4, 10 times that much if we grew enough to hire other employees. By not investing in the workforce like the country did with public works before the information age started in 1980, my generation (gen x) lost out on at least a 5x rate of return. My struggles happened just before Prosper and Kickstarter got big, so I ran up staggering credit card debt. Had we chosen a more progressive route, even at a 20% tax rate I would have paid the government back what it paid me, with the bonus of life sucking a whole lot less. I think a UBI might be one of the few things that can raise the 10% startup success rate because it attacks burn rate directly. It would also allow startups to focus on things more meaningful than video games and social media apps because it wouldn’t just be about trying to get enough F.U. money to get left alone anymore. I had always planned to save enough to be able to work on AI and alternative energy, and now with consistent hard work I have a chance of doing it, but with a middle aged realism that is just not helping my motivation. To be 20 again and told “go do all the things” is one of my deepest wishes and I hope it happens for future generations.
- Ericson2314 10y ago
  Hierarchy of needs; cross fingers

SilasX 10y ago

The problem is that the media almost always use this implicit syllogism: "70% of GDP is consumer spending. Therefore, the economy depends on consumer spending. Therefore, we need to goose consumer spending if we want to help the economy."

acqq 10y ago
No, the problem is that the whole western economy can "logically" function only based on "growth" as in "more consumption, more production every year." But math is not on our side: http://www.informationclearinghouse.info/article25458.htm http://www.informationclearinghouse.info/article25458.htm
- jomamaxx 10y ago
  'Growth' can continue every year from now until infinity. The capacity for human innovation is unlimited.
  - erelde 10y ago
    "It's not because every human has died that I will die too." I need proof that human innovation potential is unlimited.
    - marvin 10y ago
      Well, obviously not unlimited in the mathematical sense (the ordering of elementary particles in the visible universe is finite), but there is a lot of stuff that the laws of physics allows which we would like to do, but are currently incapable of doing. Just to name a few: Ensure sustainable energy production, halt and reverse global climate change, eradicate all disease and suffering, make aging and death optional, ensure that working for a living is optional, allow all humans the possibility of ethically experiencing most experiences and capabilities available to the richest 0.01%, cure all physical and mental disabilities and enhance human bodies with new senses and physical capabilities, create easily-available artificial intelligence which is at least as capable as the smartest human alive and acts in humanity's interest, and so on.

TaylorAlexander 10y ago

Absolutely agree. Check out videos on youtube under the search "New Economics" for more info about this. There's some great channels (like the New Economy Coalition) with full lectures, but check out this short primer video on the concept: https://www.youtube.com/watch?v=FrIhloNEwT8 https://www.youtube.com/watch?v=FrIhloNEwT8 See my comment about this in another thread for more links: https://news.ycombinator.com/item?id=12243080 https://news.ycombinator.com/item?id=12243080

whenwillitstop 10y ago

The problem is that we live in a world governed by natural forces, and not by spiritual revolutions.

Normal_gaussian 10y ago
Can you elaborate on this? What are you classing as natural forces? Spiritual revolutions? Such a small comment is so easy to dismiss because what you mean is not clear and those of us reading it can dismiss it as trite, obvious, or irrelevant without consideration or if we do give it consideration we are at the mercy of our own interpretation of the words used - either way it makes something you obviously cared enough about to write a null contribution to the conversation.
ZenoArrow 10y ago
Which natural forces are you referring to? Are you sure that they are natural forces (rather than learned behaviour)?
- nine_k 10y ago
  Game theory, mostly.
  - ZenoArrow 10y ago
    If game theory is natural law then it should apply to all humans, regardless of background. How does it apply to the groups of people who aren't driven by amassing material possessions (hunter-gatherer tribes, monks/nuns, etc...)?
tunap 10y ago
You mean 'unnatural forces'? As a species we have made great progress in mitigating natural forces. Not utopian, but there is enough resources, logistics and actors to feed the entire world, if a relative few didn't have to take all they can sequester for themselves. I see more forces pertaining to greed (infinite inflation racket, regulations as barriers, control of *-opolies, artificial shortages boost prices) holding back humanity.

icebraining 10y ago

Robert "Bobby" Kennedy's 1968 speech is appropriate: https://www.theguardian.com/news/datablog/2012/may/24/robert-kennedy-gdp https://www.theguardian.com/news/datablog/2012/may/24/robert...

blazespin 10y ago
That is incredibly uplifting and deeply deeply disturbing at the same time.
yolesaber 10y ago
Thank you so much for this

psadri 10y ago

Our culture of consumption has roots in our biological drives. We are more attractive reproductive mates if we have more material resources. Therefore, a bigger house >> a small house, etc. although, as a side note, we seem to have lost the direct connection between the two -- people continue to want fancy stuff well past their reproductive age. For the world you want to become true, something else must become biologically attractive.

herval 10y ago
That sounds veeeery far-fetched. How about societies where material resources aren't the main goal? How does that explain poor people having more babies? Is there any known correlation between "having more stuff" and reproduction at all? If any, the somewhat accepted reproductive drive is "passing down your genes" - and people/animals/any creature that displays more "power" tends to attract more mates. And power doesn't translate to material resources in most cultures/societies/animal races...
- psadri 10y ago
  Material resources are the most obvious way to demonstrate you have "power". As for poor people with many babies -- it could be due to lack of access to birth control, or sometimes an insurance against high infant mortality rates. When your livelihood depends on how many hands are helping you in the farm, you want to make sure you have at least X babies.
  - bballer 10y ago
    You both missed the most obvious answer as to why poor people generally have more children; poor people typically have more time on their hands and encounter boredom more frequently, thus they fill this time with intercourse. Couple this with a lack of birth control and viola, more children. Of course in the context of farming having more hands around is essential to survival, in most other cases though more children will further impoverish the couple.
    - 10y ago

ArkyBeagle 10y ago

Most consumption doesn't involve big houses and TVs. Those exist as signal items mainly because they're paid for with debt, which increases the amount of money in circulation. Education is now a good that also increases debt, with mixed results. Throwing money at it does not change the predictive value of the standardized tests used to "ration" education. Without increases in the money supply, there simply won't be growth. There's only so much the central banks and government can do; at some point, people either spend or they don't. The one thing that can be done is to try to adjust inflation upwards, which increases the risk of lazy investments.

vixen99 10y ago

'we have hit peak consumption'. I'm wondering - who is the 'we' you have in mind? Folk across vast areas of the planet might be at a loss to know what you're on about.

paulpauper 10y ago

not sure how a functioning economy can exist without consumption of some form.

herval 10y ago
Likewise, people were very skeptical about centralized currency/printed money when it was first introduced. Or if you want something more recent - skeptical that industry would ever surpass agricultural production, or services would ever overtake industrial goods, without destroying economy. Doesn't mean it _can't_ happen...
- nine_k 10y ago
  If you look at what fiat money had become in past, e.g. Germany of 1920s, you'll see that the doubts were quite founded. Even if you take a look at most important modern currencies, you'll see how much trickery is involved (quantitative easing, etc).

tcbawo 10y ago

Other than spending money, there is only saving and investment. Some believe that our current lack of demand is caused by too much money chasing too few investments.

acd 10y ago

This is very true its destructive to the environment to just be zombie consumers buying more "stuff". If you would be given carbon emissions as a currency and then you could choose to spend it. Products may be different. A long lasting product would be cheap and a short lasting product would be expensive.

superuser2 10y ago
Product consumption isn't anything special these days, it's all about services now.
tunap 10y ago
Additionally, how about giving some weight to packaging; especially the ubiquitous petro derived variety.

deleted 10y ago

[deleted]

superuser2 10y ago

Slightly off-topic, but since you brought it up. A 40" TV is, like, $300 [0]. The average American watches 5 hours a day [1]. Replace your TV every year, that's $0.16 per hour of entertainment. I probably pay more than that in bus fare and late fees to use the public library. Big-screen TVs don't belong on the list of excessive consumption items anymore. They are incredibly cheap and deliver enormous utility relative to expenditures that get drastically less hate, like a data plan for even the cheapest smartphone, plane tickets/vacations in general, picking the crossover instead of the compact sedan, picking the very slightly nicer apartment, etc. [0] http://www.bestbuy.com/site/tvs/led-tvs/pcmcat193400050018.c?id=pcmcat193400050018 http://www.bestbuy.com/site/tvs/led-tvs/pcmcat193400050018.c... [1] http://www.recode.net/2016/6/27/12041028/tv-hours-per-week-nielsen http://www.recode.net/2016/6/27/12041028/tv-hours-per-week-n...

susan_hall 10y ago
I think "TV" is a stand-in for "watching TV". That is a common sense reading. And what do you watch on TV? Your statement is correct if you only watch broadcasts, but that is only 9% of the USA public. Almost 90% of USA households have cable. The cable is a monthly fee. That changes the economics that you suggested. In the UK, the economics are slightly different, but recall that UK taxpayers pay a fee to the BBC.
- matthewmacleod 10y ago
  Uk taxpayers do not pay a fee to the BBC. Every household that uses equipment to receive live broadcasts much purchase a TV license, but that's quite different.
  - richthegeek 10y ago
    That's a semantic argument really. The license fee funds the BBC, and the BBC are the ones who care about collecting it (even if at arms length with the official 'enforcer'). Every argument about the future of the license fee, or not paying it on an individual level, explicitly state the BBC as the benefactor of this fee. The fact that it's tied to equipment capable of receiving live broadcasts (until September) is not much more than a clever workaround.

jganetsk 10y ago

Instead of measuring GDP as our metric, measure how much basic income can be generated without causing inflation. Rising basic income levels with stable GDP and stable prices (or even falling) is utopia.

nercht12 10y ago
Agreeable, in theory at least. The fact is, though, when one person gains, someone else loses out, in this case, biz owners. Corporate execs aren't going to raise wages and keep prices the same, not unless they have some means to compensate for it (Hello, McDonalds!)

narrator 10y ago

Keynesianism says that spending money on anything is good, no matter what. War is good, make work projects that do nothing are good, spending money on frivolous consumer goods is good, etc. Austrian school recognizes that investing in productive capital that lowers the cost of production and resources consumed in production is actual real economic progress. For example, let's say you have an island with coconuts. If you pay everybody $100 to go out and buy coconuts, the price is going to just go up. If you pay them $100 to plant more coconut trees or make tools to harvest them more efficiently, there are going to be more coconuts and the price is going to go down. Keynesianism would say the two are equivalent economically because AD = C + I + G + (X-M) and in this equation C and I are perfectly interchangeable. If you want to read the long version of that I'd suggest Hayek's critique of the paradox of savings: https://mises.org/library/hayek-paradox-saving https://mises.org/library/hayek-paradox-saving

TheOtherHobbes 10y ago
Hayek is one of the reasons we're in this mess, so - coconuts or no - it's hard to believe that more Hayek is a solution. I don't recall Keynes saying any of the things you claim he said. He actually said this: "If the Treasury were to fill old bottles with banknotes, bury them at suitable depths in disused coalmines which are then filled up to the surface with town rubbish, and leave it to private enterprise on well-tried principles of laissez-faire to dig the notes up again (the right to do so being obtained, of course, by tendering for leases of the note-bearing territory), there need be no more unemployment and, with the help of the repercussions, the real income of the community, and its capital wealth also, would probably become a good deal greater than it actually is. It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing." Perceptive readers may notice a certain hint of irony in the above, which Austrian economists - being literally minded, on the whole - may have missed.
- shitgoose 10y ago
  I am also missing on the irony here. Could you, please, elaborate?

golemotron 10y ago

> We need to find ways to 'grow' our economy without increasing consumption. For example, measure growth by how people are becoming more educated. That isn't the same as growing the economy. Changing the definition of a word doesn't not change the reality of the thing it refers to. In this case, economic stagnation due to lack of growth.

edcastano 10y ago

I couldn't agree more, and am ecstatic that there are other like minded people. I believe my response to this Quora question, is one way to get this outcome. Would be curious to get your reaction to the idea. https://www.quora.com/In-your-opinion-what-should-the-United-States-change-about-its-tax-structure https://www.quora.com/In-your-opinion-what-should-the-United... The only good tax…a tax on “bads” The U.S. federal government first imposed a [temporary] personal income tax in 1861, in order to pay for the Civil War. The tax was later made permanent in 1913. In other words, our country is stuck on a nineteenth century tax model, collecting 95% of our revenue from labor and investment. I believe government slaps taxes on income and investment out of sheer momentum. If all you have is a hammer, everything looks like a nail. If we were designing a tax framework from the ground up, it would surely look different. In its simplest form, I’d say it would entail taxing “bads” instead of taxing “goods”. Let me explain.Of the $2.4 trillion in federal tax receipts collected every year in the U.S., 95% comes from taxing labor and investment. These are activities that generate social benefits; jobs, goods, and technological progress. Economists call these positive externalities, but we can simply call these “goods”. On the flip side, less than 2% of the $2.4 trillion in federal revenue comes from taxing—waste, pollution, and resource depletion—activities that generate social ills like obesity, heart disease, cancer, urban sprawl, materialism, and resource wars. Economists call these negative externalities but we can simply call these “bads”. A sensible tax policy would entail taxing “bads” instead of “goods”. Today we have it backwards, with the bulk of the federal tax burden, (95%) falling on taxing “goods” like labor and investment, instead of “bads” like resource depletion, waste and pollution. Some will argue that such a system would be regressive and punish those that can least afford it. However, this system can be combined with a monthly federal stipend of a couple of hundred dollars for every single man, woman and child in the country to make the system progressive. In this scenario, those who save energy and resources, make money, and those that waste it, pay. Nonetheless, everyone, rich or poor would have a strong incentive not to be wasteful. More importantly, it would eliminate the disincentive to work. This approach would help solve some of our nation’s largest problems. People would be healthier since the prices we pay for food would reflect the energy and resource intensity of meat vs. produce…thus leading people to consume more produce. We’d start seriously investing in energy efficiency, not because of government mandates, but because it would make financial sense. The approach might even help put our fiscal house in order since it would imply eliminating corporate welfare and all subsidies, including those for clean energy. Market forces would take over without all the loopholes that inevitably skew our personal decisions and ultimately the national economy. Families would have a strong incentive to save and invest, instead of waste and consume, reversing a century of falling savings rate. It might even help reverse the last 60 years of cultural decay…combating materialism, consumerism, and the decline of the family. I won’t argue at what level our economy should be taxed. My point is that if we will have any tax what-so-ever, it should not come from the work of; the policeman protecting our streets, the agent insuring our home, or the entrepreneur creating new industries and jobs for society. If nothing can be said to be certain except for death and taxes, then let’s use taxes to help us live longer, richer lives, and leave a world for our children that is not worse off than the one we found. --------------------------------------------- --------------------------------------------- This led me to create this site http://www.writegreen.org http://www.writegreen.org. Might have to give is 30 seconds or so to load (I've got it hosted on slow Heroku tier) The idea was to empower citizens to use their own philosophy to advocate sustainability with our politicians. The ideas is, change your politicians, not just your light bulbs.

refurb 10y ago

Growth as a result of consumption is destructive....For example, measure growth by how people are becoming more educated." You realize that consumption includes education, right?

KMag 10y ago
But the measurement of consumption is in currency, typically USD. If you get that education via a free MOOC, then its contribution toward consumption measures is the cost of the electricity and bandwidth you used... essentially zero.

jeffdavis 10y ago

Great comment. I'd like to see this idea developed a little more thoroughly -- any suggestions?

flukus 10y ago

> I believe (or rather, I pray) that we have hit peak consumption which will lead to this problem forevermore. We need to find new ways to improve ourselves than shopping more. I think if we had more time we could certainly be consuming more, at least it's my limiting factor (besides money). Imagine if we halved the work week or invented a pill that would let us survive on 1 hour sleep a night, that creates a lot more hours of consumption.

jldugger 10y ago

> For example, measure growth by how people are becoming more educated. If people could live healthily and intelligent and only work 10 hours a week until they were 100, wouldn't that be better than being able to buy a new car every year? At least on the margins, nobody is doing this. And I doubt it's because the GDP numbers says not to.

jomamaxx 10y ago

"Growth as a result of consumption is destructive. " I'm sorry, but this is completely ridiculous. 'Consumption' is the primary driver of economic growth, and it will always be thus. Without 'consumption' there is literally no economy. If people want to work 10 hour weeks, they can do that, though I should point out, most kinds of work activities, especially the high value ones, don't work that way. Better to work 40 hour weeks for 10 years, save everything, and retire. Surely we need to find a way to clean up after ourselves and solve the problem of fewer resources and more garbage, but in general 'consumption' is good, or else there is no 'work' and no 'jobs' - even 10 hr/week jobs.