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" Yet for academics and central bankers the only answer to growth is more debt." The uttermost definition of capitalism. "Our economies and culture have a ski

" Yet for academics and central bankers the only answer to growth is more debt." The uttermost definition of capitalism. "Our economies and culture have a skills crisis not a growth crisis." Capitalism can't survive without growth by definition. https://ourfiniteworld.com/2011/02/21/there-is-no-steady-state-economy-except-at-a-very-basic-level/ https://ourfiniteworld.com/2011/02/21/there-is-no-steady-sta...

JumpCrisscross 6y ago
> Capitalism can't survive without growth by definition Capitalism prefers growth. It causes growth, which is good. (Growth does not have to mean resource intensity.) It does not require growth. Zero-grow and shrinking economies can allocate resources well through markets.
- atmosx 6y ago
  You mean intellectual growth then? Because for everything else someone somewhere will need very tangible resources e.g. raw materials to build that phone you are using do X or Y.
  - goatinaboat 6y ago
    Because for everything else someone somewhere will need very tangible resources e.g. raw materials to build that phone you are using do X or Y. The price of a CPU is unrelated to the price of sand. CPUs are 10000x faster over the last couple of decades. So there’s little or no correlation required between raw materials consumption and growth.
    - atmosx 6y ago
      A CPU is one of the few dozens of components that you need to get a tangible result out of a CPU. You need hard disks, screens, antennas, batteries and so on and so forth. So you need, copper, lithium and God knows what else. All these materials get transformed and many of them in the process get transformed to toxic material for humans. Do you really believe that computing comes cheap and is unrelated to climate change? I find that line of thinking extremely naive. Let me share a few links: https://www.nature.com/articles/s41558-018-0321-8 https://www.nature.com/articles/s41558-018-0321-8 https://www.theguardian.com/environment/2010/apr/30/cloud-computing-carbon-emissions https://www.theguardian.com/environment/2010/apr/30/cloud-co... etc.
      - goatinaboat 6y ago
        Do you really believe that computing comes cheap and is unrelated to climate change? I find that line of thinking extremely naive. No I believe something more subtle than that: that the same raw materials that make a computer of speed X can be used to make a computer of speed 1000X with the input of better design. So we have economic growth there purely through intellect with no correlation to raw materials consumed.
        atmosx 6y ago
        Sorry, I misunderstood. Now makes sense to me.
- HourglassFR 6y ago
  > (Growth does not have to mean resource intensity.) That would be wonderful, alas the data we have suggest otherwise. But if you have ideas of how that decoupling between ressource extraction and growth could work I would glad to hear/read them (for real, I would like to be more positive on those matters).
  - JumpCrisscross 6y ago
    > the data we have suggest otherwise No [1]. They don’t [2]. > if you have ideas of how that decoupling between ressource extraction and growth could work The universe of digital goods and services, for one. A few grams of metal and silicon producing as much value today as a car’s worth of steel did a century ago. [1] https://www.eia.gov/todayinenergy/detail.php?id=10191 https://www.eia.gov/todayinenergy/detail.php?id=10191 [2] https://www.wri.org/blog/2020/07/decoupling-emissions-gdp-us https://www.wri.org/blog/2020/07/decoupling-emissions-gdp-us
    - bsanr2 6y ago
      You forgot the electrons. https://davidmytton.blog/how-much-energy-do-data-centers-use/ https://davidmytton.blog/how-much-energy-do-data-centers-use...
      - JumpCrisscross 6y ago
        Taken into account in the first link [1]. [1] https://www.eia.gov/todayinenergy/detail.php?id=10191 https://www.eia.gov/todayinenergy/detail.php?id=10191
    - newdude116 6y ago
      1st, check this link: https://www.sciencealert.com/computers-will-require-more-energy-than-the-world-generates-by-2040 https://www.sciencealert.com/computers-will-require-more-ene... 2nd, check this link: https://ourfiniteworld.com/2011/11/30/thoughts-on-why-energy-use-and-co2-emissions-are-rising-as-fast-as-gdp/ https://ourfiniteworld.com/2011/11/30/thoughts-on-why-energy... "3. Rest of the World. This group is the only group showing a favorable trend in energy growth relative to GDP growth, even in the last decade, although the pace of improvement has slowed. Two reasons for this favorable trend seem to be (a) continued growth of services, such as financial service, healthcare, and education, which use relatively little energy and (b) outsourcing of a major portion of heavy industry to Southeast Asia." iPhones are produced in China. But the profits appear at Apple Inc.
- ianleeclark 6y ago
  > Zero-grow and shrinking economies can allocate resources well through markets. Capitalism isn't "a/many market(s)." Capitalism is much more than that, and one of those constituent pieces is profit-seeking.
  - chii 6y ago
    a functioning market require profit-seeking behaviour.
    - ianleeclark 6y ago
      You could have a market of simple exchange without profit-seeking behavior. A market is just a collection of social relations wherein people exchange things.
- newdude116 6y ago
  You mistake a market economy for capitalism. We had a market economy for a very long time, even in the middle ages. Actually Ludwig von Mises describes this barter based market economies perfect (but fails to understand capitalism). Capitalism, that we have have since more or less 150 years requires the pre financing on a huge scale of industrial production. This requires debt that can only be, due to interest, paid back with growth. There can't be a capitalist economy without growth by definition. From the link given by me: "One big issue with even trying to stair-step fossil fuel use is the fact that our financial system needs growth to keep from collapsing. In order to pay back debt with interest, it is necessary to have economic growth, and financial growth and growth in fossil fuel use are very closely tied. Economic growth can be 2% or 3% above fossil fuel use growth because of efficiency gains, and economic growth in a particular country can be higher than that of world economic growth because of greater outsourcing of manufacturing to other countries. There was even a gain in the late 70s and early 80s, as we picked the low-hanging efficiency fruit and switched to using nuclear. But overall, there is no evidence that fossil fuel use, or even oil use, can be divorced from economic growth. If there is a big decline in fossil fuel use, it will translate to a decline in economic growth. The need for economic growth in order to pay back debt even applies to our money supply itself. Money is loaned into existence. This happens when a commercial bank makes a loan and deposit at the same time. The problem is that when the money is created, not enough money is loaned into existence to pay back the interest as well. So economic growth is needed to create the additional money so that the debt can be paid back with interest. Because of this issue, a Steady State Economy (economy without growth) requires a financial system with virtually no debt. It might be possible to have a little debt, but its use would be primarily to facilitate short-term transactions. Debt jubilees at regular intervals might be needed, to keep people from building up much debt."
  - JumpCrisscross 6y ago
    > to pay back debt with interest, it is necessary to have economic growth, and financial growth This toy model ignores defaults and fiscal spending. Defaults destroy debt in the absence of growth (in the process transferring wealth from creditors to debtors). Fiscal spending crates money with no debt (in the process transferring wealth from savers to borrowers). These counter-currents let the system stay stable while credit flows from savers (via equity) and creditors (via debt) to investments and borrowers. Leveraged systems have a multitude of steady states in a zero-sum environment. Even more when tastes and preferences change as human tastes and preferences do. > growth in fossil fuel use are very closely tied I have debunked this in another comment [1]. Energy intensity of GDP has been falling for decades. The carbon intensity of our economy is falling faster. [1] https://news.ycombinator.com/item?id=24979345 https://news.ycombinator.com/item?id=24979345

JumpCrisscross 6y ago

> Capitalism can't survive without growth by definition Capitalism prefers growth. It causes growth, which is good. (Growth does not have to mean resource intensity.) It does not require growth. Zero-grow and shrinking economies can allocate resources well through markets.

atmosx 6y ago
You mean intellectual growth then? Because for everything else someone somewhere will need very tangible resources e.g. raw materials to build that phone you are using do X or Y.
- goatinaboat 6y ago
  Because for everything else someone somewhere will need very tangible resources e.g. raw materials to build that phone you are using do X or Y. The price of a CPU is unrelated to the price of sand. CPUs are 10000x faster over the last couple of decades. So there’s little or no correlation required between raw materials consumption and growth.
  - atmosx 6y ago
    A CPU is one of the few dozens of components that you need to get a tangible result out of a CPU. You need hard disks, screens, antennas, batteries and so on and so forth. So you need, copper, lithium and God knows what else. All these materials get transformed and many of them in the process get transformed to toxic material for humans. Do you really believe that computing comes cheap and is unrelated to climate change? I find that line of thinking extremely naive. Let me share a few links: https://www.nature.com/articles/s41558-018-0321-8 https://www.nature.com/articles/s41558-018-0321-8 https://www.theguardian.com/environment/2010/apr/30/cloud-computing-carbon-emissions https://www.theguardian.com/environment/2010/apr/30/cloud-co... etc.
    - goatinaboat 6y ago
      Do you really believe that computing comes cheap and is unrelated to climate change? I find that line of thinking extremely naive. No I believe something more subtle than that: that the same raw materials that make a computer of speed X can be used to make a computer of speed 1000X with the input of better design. So we have economic growth there purely through intellect with no correlation to raw materials consumed.
      - atmosx 6y ago
        Sorry, I misunderstood. Now makes sense to me.
HourglassFR 6y ago
> (Growth does not have to mean resource intensity.) That would be wonderful, alas the data we have suggest otherwise. But if you have ideas of how that decoupling between ressource extraction and growth could work I would glad to hear/read them (for real, I would like to be more positive on those matters).
- JumpCrisscross 6y ago
  > the data we have suggest otherwise No [1]. They don’t [2]. > if you have ideas of how that decoupling between ressource extraction and growth could work The universe of digital goods and services, for one. A few grams of metal and silicon producing as much value today as a car’s worth of steel did a century ago. [1] https://www.eia.gov/todayinenergy/detail.php?id=10191 https://www.eia.gov/todayinenergy/detail.php?id=10191 [2] https://www.wri.org/blog/2020/07/decoupling-emissions-gdp-us https://www.wri.org/blog/2020/07/decoupling-emissions-gdp-us
  - bsanr2 6y ago
    You forgot the electrons. https://davidmytton.blog/how-much-energy-do-data-centers-use/ https://davidmytton.blog/how-much-energy-do-data-centers-use...
    - JumpCrisscross 6y ago
      Taken into account in the first link [1]. [1] https://www.eia.gov/todayinenergy/detail.php?id=10191 https://www.eia.gov/todayinenergy/detail.php?id=10191
  - newdude116 6y ago
    1st, check this link: https://www.sciencealert.com/computers-will-require-more-energy-than-the-world-generates-by-2040 https://www.sciencealert.com/computers-will-require-more-ene... 2nd, check this link: https://ourfiniteworld.com/2011/11/30/thoughts-on-why-energy-use-and-co2-emissions-are-rising-as-fast-as-gdp/ https://ourfiniteworld.com/2011/11/30/thoughts-on-why-energy... "3. Rest of the World. This group is the only group showing a favorable trend in energy growth relative to GDP growth, even in the last decade, although the pace of improvement has slowed. Two reasons for this favorable trend seem to be (a) continued growth of services, such as financial service, healthcare, and education, which use relatively little energy and (b) outsourcing of a major portion of heavy industry to Southeast Asia." iPhones are produced in China. But the profits appear at Apple Inc.
ianleeclark 6y ago
> Zero-grow and shrinking economies can allocate resources well through markets. Capitalism isn't "a/many market(s)." Capitalism is much more than that, and one of those constituent pieces is profit-seeking.
- chii 6y ago
  a functioning market require profit-seeking behaviour.
  - ianleeclark 6y ago
    You could have a market of simple exchange without profit-seeking behavior. A market is just a collection of social relations wherein people exchange things.
newdude116 6y ago
You mistake a market economy for capitalism. We had a market economy for a very long time, even in the middle ages. Actually Ludwig von Mises describes this barter based market economies perfect (but fails to understand capitalism). Capitalism, that we have have since more or less 150 years requires the pre financing on a huge scale of industrial production. This requires debt that can only be, due to interest, paid back with growth. There can't be a capitalist economy without growth by definition. From the link given by me: "One big issue with even trying to stair-step fossil fuel use is the fact that our financial system needs growth to keep from collapsing. In order to pay back debt with interest, it is necessary to have economic growth, and financial growth and growth in fossil fuel use are very closely tied. Economic growth can be 2% or 3% above fossil fuel use growth because of efficiency gains, and economic growth in a particular country can be higher than that of world economic growth because of greater outsourcing of manufacturing to other countries. There was even a gain in the late 70s and early 80s, as we picked the low-hanging efficiency fruit and switched to using nuclear. But overall, there is no evidence that fossil fuel use, or even oil use, can be divorced from economic growth. If there is a big decline in fossil fuel use, it will translate to a decline in economic growth. The need for economic growth in order to pay back debt even applies to our money supply itself. Money is loaned into existence. This happens when a commercial bank makes a loan and deposit at the same time. The problem is that when the money is created, not enough money is loaned into existence to pay back the interest as well. So economic growth is needed to create the additional money so that the debt can be paid back with interest. Because of this issue, a Steady State Economy (economy without growth) requires a financial system with virtually no debt. It might be possible to have a little debt, but its use would be primarily to facilitate short-term transactions. Debt jubilees at regular intervals might be needed, to keep people from building up much debt."
- JumpCrisscross 6y ago
  > to pay back debt with interest, it is necessary to have economic growth, and financial growth This toy model ignores defaults and fiscal spending. Defaults destroy debt in the absence of growth (in the process transferring wealth from creditors to debtors). Fiscal spending crates money with no debt (in the process transferring wealth from savers to borrowers). These counter-currents let the system stay stable while credit flows from savers (via equity) and creditors (via debt) to investments and borrowers. Leveraged systems have a multitude of steady states in a zero-sum environment. Even more when tastes and preferences change as human tastes and preferences do. > growth in fossil fuel use are very closely tied I have debunked this in another comment [1]. Energy intensity of GDP has been falling for decades. The carbon intensity of our economy is falling faster. [1] https://news.ycombinator.com/item?id=24979345 https://news.ycombinator.com/item?id=24979345