38 ms·

This Isn't Capitalism, It's Growthism, and It's Bad for Us

119 points by ArekDymalski 13y ago

ffrryuu 13y ago
Anything that grows infinitely is cancer.
- icebraining 13y ago
  What about human knowledge?
  - ThomPete 13y ago
    Human knowledge can't grow infinitely.
    - maddddddddddddd 13y ago
      P=/=NP
    - jlgreco 13y ago
      Strictly speaking, neither can cancer. Both are limited by the capacity of the host.
      - ffrryuu 13y ago
        And so is capitalism/growthism.
- swombat 13y ago
  Cancers don't grow infinitely. They stop when the host dies. Entropy, on the other hand...
  - eli_gottlieb 13y ago
    Goddamnit, entropy.
quadrangle 13y ago
Capitalism is itself based on constant growth. There is a fundamental misunderstanding with this article (and most of our society) and that is the conflation of capitalism and a free market. A truly free market is not necessarily capitalist, and actually capitalism doesn't lead to free markets. This confusion is messing up everyone's thoughts. What we like is the free market, the natural bottom-up interactions that help determine prices and such. Free markets have nice features. Capitalism is about profit and growth and the instant you think it isn't going to fail, everyone might as well speculate like crazy (why not? if it isn't going to fail…). The only way for capitalism to work is for everyone to realize that it is inherently unstable and likely to fail. And that realization is true also. We can still advocate for market freedom without advocating capitalism.
- chamblin 13y ago
  >> A truly free market is not necessarily capitalist Can you elaborate?
- dnautics 13y ago
  >Capitalism is itself based on constant growth That's not quite true. Capitalism is based on the principle that "the accrual of wealth (capital) is a virtue unto itself". This does not entail any level of growth. Free-marketism is a bit lighter, based on the principle that "making a profit is an indicator that you are providing social goods efficiently". It's really neoliberal capitalism (largely via neokeynesianism - but notably not what Keynes said himself, necessarily) that has espoused growthism. The austrian school does the best at presenting a critique of this neoliberal capitalism, but unfortunately the ranks of austrianism are also populated by people who don't believe in limited resources and environmental catastrophe, and don't talk enough about how growthism really screws over the poor via inflation. And also the austrian school is polluted by crazy goldbugs, who have the story half-right but run like hell with the wrong half.
- Ensorceled 13y ago
  "Capitalism is itself based on constant growth." No, constantly increasing profits or shareholder value are based upon constant growth. Capitalism does not require constantly increasing growth of profits to be "capitalism". This "corporations must constantly grow" is, along with "corporations must, by law, sociopathically seek profit", the major reason that American style capitalism isn't viable. It eats it's young.
johnrob 13y ago
I see this type of thinking a lot, sometimes even within myself. I don't think the problem is Capitalism (or "Growthism") - it's that we don't do much as we could to counter act the negative effects. Instead of worrying about the rich/poor divide, we could instead try to improve conditions for those on the bottom (food/shelter/health are all good starting points).
- dnautics 13y ago
  But the point is that "trying to improve conditions for those on the bottom" will never pan out, because the effects of growthism on the poor are compounding, i.e. exponential, and at best those things you are trying to improve the lot of others, scale linearly. Things get really bad when you do things like government welfare, which provides a linear benefit to the less fortunate while enriching the rich and polticially connected far more (indirectly, through deficit spending).
  - cromwellian 13y ago
    That's false. In the limit, you could have 100% of the population unemployed, robots manufacturing everything and have the robots and robot factory owners taxed at 99.9% FICA, paying social security to everyone at birth. This scenario has been covered by quite a few "post-work" authors, who look at humans returning to a hunter-gather society. See Hans Moravec in _Mind Children_ for example. We used to walk around and these marvelous automated machines produced everything for us: nuts and fruits from trees, free for the picking. In the future, we'll walk around, and robots will be churning out the equivalent of fruits and nuts from factories. The modern concern of labor arises from the industrial revolution.
    - dnautics 13y ago
      It's not a growthist system, though, if previously accrued tax receipts are used to pay out the welfare you're describing. What would make it growthist, is if the welfare is paid for by borrowing, which would require compounding interest to pay it off. That the payback requires interest (which compounds, i.e. grows) implies growth in the overall productivity of the system to continue functioning. Moreover, if you consider these post-work humans to be "poor" something strange is going on in your head. It's easy to conflate "unemployed" with "poor" because that's generally the case in our society. But I wouldn't consider the humans in your "limit case" (with my growthist modification) to be the poor people being screwed over by the growthism. It's the robots.
dragonwriter 13y ago
I am endlessly amused by people pointing to features that the socialists who came up with the word "capitalism" to name the system they were criticizing criticized capitalism for and saying "this isn't capitalism". But, no, the features that are being complained about as "growthism" -- the idea of being "willing to sacrifice everything for more growth" -- is exactly a feature of capitalism that those 19th Century socialists who coined the term "capitalism" were criticizing. See, inter alia, Karl Marx. "Effect of Capitalist Competition on the Capitalist Class[,] the Middle Class[,] and the Working Class", in Wage Labour and Capital at http://www.marxists.org/archive/marx/works/1847/wage-labour/ch09.htm http://www.marxists.org/archive/marx/works/1847/wage-labour/...
- dnautics 13y ago
  One could make the argument that free marketism inevitably brings about capitalism which inevitably turns into growthism. Much like Benjamin Tucker's argument that Marxism inevitably ends in Stalinism (he made this argument as a contemporary of Marx, so this wasn't hindsight). I happen to actually believe Schumpeter's model better (that capitalism turns to gas and water socialism turns to growthism). It is, however, telling, that there are plenty of free-marketers who espouse essentially the same argument as Mr. Haque, for example the Austrian school of economics (which is full of kooks for other reasons). Chris Martenson (who called the 2008 crash) is another.
  - dragonwriter 13y ago
    > One could make the argument that free marketism inevitably brings about capitalism which inevitably turns into growthism. I wouldn't make the first part of that argument, because I'm not convinced that "free marketism" is even a real thing, much less a precursor of capitalism. It seems to be position presented as a rhetorical defense of capitalism, but doesn't seem to exist independently. But what this article calls "growthism" is one of the core features of capitalism called out by the people who named it. Capitalism doesn't inevitably turn into growthism, it is (or, at least, includes as an essential feature) growthism. > Much like Benjamin Tucker's argument that Marxism inevitably ends in Stalinism (he made this argument as a contemporary of Marx, so this wasn't hindsight). Stalinism -- or, more to the point, Leninism -- requires both Marxism and an environment that is unlike the ones described by the descriptive elements of Marxism in a particular way into which one attempts to translate the prescriptive elements. Given those ingredients, I'd agree that its pretty much inevitable that something like Leninism will at least be attempted. Marxism itself doesn't inevitably become Leninism/Stalinism, but its existence makes the existence of such a system quite likely. > I happen to actually believe Schumpeter's model better (that capitalism turns to gas and water socialism turns to growthism). I would argue more that the empirical evidence is that capitalism plus the existence of socialist ideas leads fairly usually (even if not inevitably) to a variety of mixed systems that feature a basically capitalist structure with socialist elements (including growthism), of which "gas and water socialism" is an example.
apsec112 13y ago
This mostly makes two points: 1. America is screwed up. But we know that. 2. Arguments from My Opponent Believes Something: http://slatestarcodex.com/2013/06/13/arguments-from-my-opponent-believes-something/ http://slatestarcodex.com/2013/06/13/arguments-from-my-oppon... Eg.: "1. Argument From My Opponent Believes Something, Which Is Kinda Like Believing It On Faith, Which Is Kinda Like Them Being A Religion: “The high priests of the economic orthodoxy take it on faith that anyone who doubts the market is a heretic who must be punished.”"
grecy 13y ago
> So maybe, then, it’s time for you and I to leave this cult...The cheap, plastic junk that surrounds us probably isn’t worth what we paid – not just in cash (or, more likely, credit) to get it, but in freedom, time, and tears. This strikes a chord with me at a very deep level. A few years back I was completely disillusioned with living and working in a big city, basically just to buy more stuff. It still boggles my mind we all go to work 40 hours a week then come up with more and more creative ways to waste that excess of money, rather than just work less and have more time. I sold everything, quit my job, and spent 2 years driving from Alaska to Argentina, living in my tent and cooking on my little travel stove. My perspective on the world has changed immensely, and I now live in the very far north, grow and hunt/fish my own food, and only go to work enough to have the quality of life I want. That's usually around 2-3 days a week, depending if I want a new toy that month (rifle/camera/etc.) I highly, highly recommend people take a break from consumerism for an extended period of time and see how fulfilling your life can be without all that stuff. Some of the happiest people I've ever met in my life have nothing by North American standards.
- pieterhg 13y ago
  It's an outdated system which is not relevant anymore. Luckily you and many people like you are increasingly duscovering this life does not equate to happiness and in many cases actively avoids reaching happiness (e.g. 9-5, office hierarchies and debt)
  - vasilipupkin 13y ago
    I would like to point out that going to work only 2-3 days a week and hunting/growing your own food is likely to get stale very quickly if you ever decide to start a family.
    - grecy 13y ago
      The exact opposite is true. The whole point of having a family is to spend time with your family, which you can do when you're not at work all the time. The very vast majority of people up here living the simple life are families.
cromwellian 13y ago
This is a rather incoherent rant. Growth = Bad. What's bad is if growth is achieved by irrevocable destruction of the environment, or deterioration of the human condition. It's not growth itself that is the problem, for there are many kinds of growth. Growth in physical inputs? Energy use? Labor? Outputs? Value (GDP)? Some of these counter-balance the other. If efficiency goes up (productivity), there is less need for labor, but it could also mean less physical inputs required, less energy, etc, so good for the environment. Also, the increased surplus means that labor can enjoy more fruits of its produce (in theory). And growth in value is another thing entirely, because it is a human value assigned by our minds, not an objective physical quantity. Just take virtual/digital goods, someone can make one awesome piece of software, or a game, that the whole of humanity values tremendously high, but which has O(1) marginal costs to produce for each person, and which took relatively few inputs. If I suddenly uploaded the entirety of humanity into the Matrix, all of a sudden, value can continue to increase, without continued use of environmental resources beyond the energy needed to run it. Today, if I make a piano, I have to cut down trees and use tons of energy, so for everyone on the planet to own a piano would be very bad. But if I make a virtual piano, everyone on the planet can have one at relatively low cost, and then the question simply falls to how good the simulation can be. I'd analogize Capitalism to evolution in an ecosystem. The entities within the system can grow, change form, multiply, and die. If they grow too much too fast, they can deplete their resources too quickly to sustain their population. They must have wild swings between mass die-offs and mass growth, or they might have a relatively stable pattern with low volatility, but while growth is slowed, they still have competition, they have not "switched off" evolution. I don't think growth is bad if it comes from increasing efficiency, or an increase in value because of completely new inventions. Perhaps same physical inputs that could produce a device in 1950, produces something in 2010 that I value a lot more. It is the organization of matter, it's pattern, the information content of it, that can grow with infinite variation and which we can continue to demand.
- dnautics 13y ago
  I don't think the article makes the claim you think it does. Growth is not the same as growthism.
twoodfin 13y ago
This is so bad it makes my brain hurt trying to respond to it. We should be upset that our society has managed to put in our pockets supercomputers connected wirelessly to the world's knowledge? Ah, I see, they'll turn us into "fat miserable drooling zombies". Luckily, in this world of "skyrocketing" poverty, surely only the top 1% can afford such indulgences, right? It's not as if innovation and a growing economy have put them in the hands of more than a hundred million Americans. Oh dear, I guess the zombie apocalypse is nigh. This guy's Twitter feed[1] is more or less a constant stream of invective directed at "billionaires", like this: The billionaires believe the greatest threat to freedom is society. But a free society's great threat is billionaires. Let's say you had THREE BILLION DOLLARS in the bank. Would you really give a fuck if it was...2.75? That's like counting toilet paper! He's a clown, and it's embarrassing that HBR thinks he's valuable as a contributor. [1] https://twitter.com/umairh https://twitter.com/umairh EDIT: And in case there was any question about where he actually stands on capitalism, from a whole three days ago: So now the fashion establishment calls designers with real vision, like Westwood, "eccentric". Ah, capitalism. Fuck you so much.
- davidw 13y ago
  I'm not much of a fan of his either: https://news.ycombinator.com/item?id=176780 https://news.ycombinator.com/item?id=176780 But you might tone it down with the name calling.
  - twoodfin 13y ago
    I'll spend some time trying to come up with a fairer term than "clown", but it's hard when I come across gems like: Goddammit I love rolling into hipster cafes at 7:30 am and making them burn with racist anger.
    - jlgreco 13y ago
      What the hell does that even mean?
      - 13y ago
patmcguire 13y ago
My first thought when I saw the article title was "I bet this is by Umair Haque," and I was right. This is sort of what he does. How to fix the world is interesting, though http://howtofixtheworld.org/ http://howtofixtheworld.org/
ThomPete 13y ago
It's not Growthism per se but the lack of acknowledgment that growth needs to be taxed in a way that it still benefits society without taking the incentives away. That balance is lost in the US and people gets rich way beyond their risk. It can be fixed but it will require different taxation system IMHO.
websitescenes 13y ago
I agree with most of this article except for the main point; I think that "Growthism" and capitalism are synonymous. Growthism seems to be a scapegoat for the very real short comings of capitalism. Fact is that capitalism requires constant growth or it will fail. The real issue is valuing private property over the sacred right of life and that is what CAPITALism means.
- dnautics 13y ago
  no, captialism is valuing the accrual of property as a virtue in and of itself, not necessarily above or even competing with valuing human life. That growth is required as a part of the economic model is actually a rather modern concept that post-dates the development of capitalist philosophy, and accompanies the emergence of secular inflation as a matter of public policy. If you would like to understand how growth is "built in" to the economic system as a matter of policy and structure (and has nothing to do with capitalism per se), I would strongly recommed three resources: 1) Zeitgeist takes a left-ish perspective, and unfortunately is diluted by a lot of conspiratorial nonsense, but importantly its description of the money system is more or less correct. 2) Chris Martenson's "crash-course" is centrist, and very very good, but also very long and tedious. 3) Hidden Secrets of Money (video 4 in particular) takes a more right-leaning approach, and is tainted by the fact that the guy is obviously trying to sell you gold and silver, but the description of the money system is spot on and he strongly makes the point that growth is required. It's also the most concise and well-produced of the three.
  - PavlovsCat 13y ago
    > captialism is valuing the accrual of property as a virtue in and of itself Accrual: The act or process of accumulating; an increase. Am I missing something? How is that not "growth"? If someone has more and more, the number of things they own has to keep growing. [I put growth in quotes because I think there is a world of difference between a tree or a person growing, and bank accounts or "places to put stuff" (see Carlin et al.) growing.] > not necessarily above or even competing with valuing human life I would argue that even the focus on property - owning things just for the sake of owning them, as opposed to making, using and sustaining things (not just objects, but also ideas and living beings) for the sake of furthering life - goes against the humanity and aliveness of the person subscribing to that view. Moreover, since we're nowhere near being able to turn energy into matter, to conjure property out of, say, the energy that gets hurled around space by suns and such, property often has to come from somewhere. Not strictly necessarily, but quite often in practice, it means taking things that someone else owned, or could potentially own; wherever we're dealing with finite resources, amassing property must make the rest poorer. Sure, that's not an objective in itself, "just" an unavoidable side-effect. Kinda like alcoholism is "just" wanting to be happy/drunk, not wanting to feel miserable or making others miserable. 10 for noble intentions, 0 for intellectual honesty. Yes, it is theoretically possible for such an addiction (to own more for the sake of owning more) to at least harm no other beings than the ones suffering from it. We may get there some day. We're not there, at all.
tytso 13y ago
Think about what happens to the stock price of a company once it stops growing. It falls through the floor. It could be making enough money to pay all of its employees, and making the world a better place, but if it doesn't grow, then if it has already gone public, the stock price sinks, and all of the employees who hold stock lose a lot of money. If it hasn't gone public, then the VC's get really upset. An example of such a company was Cygnus Support, which was in no danger of going out of business, and it was supporting a hundred or so engineers and their families, which were producing high quality open source code (such as GCC, gdb, etc.) so it was certainly making the world a better place. But it was considered a failure because it didn't give the VC's a lucrative exit. That's growthism. Fortunately for Cygnus's VC's, finally Cygnus got bought by Red Hat many years later. But Red Hat is going to end up in a similar boat; as a public company, if it can't figure out a way to sustain an significant growth every year, forever, the stock price will get punished. And of course, the problem is that companies can't produce a sustained compounded growth forever, because sooner or later compounded growth will cause the company's required revenues to exceed the world's GDP. So the trick is to stay on the rocket ship as long as you can, and then sell the stock to a greater fool before it tips back towards earth. And that's growthism, too....
- refurb 13y ago
  Of course the stock will get punished, since the price of a stock is mostly based on future earnings. If a company had a growth trajectory of A and now it's a lower trajectory of B, the stock price should drop.
- anonymous 13y ago
  So then isn't the sustainable option to grow until you can, then leave the last stages of "grow, crash, burn" to some fool and then start the exact same company but with a different name (i.e. RougeChapeau) and recapture your old market by doing exactly what you used to do, but now you're in a growth position compared to your old self that crashed and burned?
- logn 13y ago
  > Think about what happens to the stock price of a company once it stops growing. It falls through the floor. I don't entirely agree. Companies which can earn stable profits and distribute those as dividends remain healthy stocks. Their stock prices might remain flat, but with dividend payments there's always a natural floor at which a stock will fall to, and no one's really holding them to make a profit on the sale of the stock (the stock price is more of a safeguard in case the companies cut dividends or you decide to liquidate to move your money). The key is finding companies which can sustain profits and those are often businesses with pricing power to keep up with inflation and competition. Here's a great blog: http://www.dividendgrowthinvestor.com/ http://www.dividendgrowthinvestor.com/ His posts go back for years, and he's very focused on researching companies which have paid strong dividends for years/decades. It's an enlightening blog, especially after being surrounded by tech companies which rarely pay dividends and have stock prices based on growth potential (but Oracle, Intel, MS, etc. have transitioned to dividend paying companies).
devinmontgomery 13y ago
Interestingly, the article appears behind a registration-required modal window, but you can read the whole article by scrolling down and leaving the window in place.
maddddddddddddd 13y ago
capitalism based on a fiat currency isn't capitalism... you're as rich as you believe you are, so you can grow as much as you believe you can. the problems arise when your beliefs are based on lies.
avn2109 13y ago
This is something I've been wondering about for a while: To what extent are our economy and stock market merely ponzi schemes that require continued population expansion? If growth slows down/reverses/stops, is the era of easy profits finished? Or in other words, what will happen to my total-market ETF shares if population growth slows/stops? Is this an argument for investment in the developing world?
deleted 13y ago
[deleted]
oakaz 13y ago
you guys are poisoned with a lot of thrash that make no sense. and here is your receipt: 1. Go to Bulgaria. 2. Get a bike. 3. Bike to Barcelona by following the Danube River. And see what the fuck capitalism is. It's the root of evil that turns villagers to slaves of companies that makes profit by filling everywhere with corn fields.
AJ007 13y ago
Irregardless of your political ideologies there are two roots to this issue which the author of this blog post seems unaware of: 1 - Government policy 2 - Central bank policy Your 401k, pension fund, home, are all dependent on prices increasing in order for you to retire or be financial secure. It just happens that if you did really well with your investments someone who has more investments than you did even better. If leverage is involved, not only do you fail to get a positive return on your investment you not only lose that asset but potentially everything else you have. Some of this policy extends beyond government subsidized lending toward things that are very looked down upon by modern Western society such as colonialism and genocide. As a civilized individual imagine yourself playing a computer game like Civilization. What strategies are you going to implement to grow bigger, get a better score, and continue playing the game?
panarky 13y ago
The author asks an honest and important question: Is capitalism failing at being the best possible means of organizing human work, life, and play? We've seen so many examples of market failure that it should be obvious that the market system is not a good answer to every problem. And when other nations chart a different course and deliver better outcomes for their citizens, that should trigger some critical questions. Failing to examine the beliefs and assumptions that public policy is built on, in the face of overwhelming evidence that those beliefs are false, really is magical thinking and cultish.
holograham 13y ago
The beautiful part of CapitalismStan is that no one becomes rich unless they in turn enrich the lives of others. Aka they produce a good/service that consumers want to freely purchase. He can rant about twisted incentives that government imposes on the free market but I can never understand why anyone can lambast capitalism when only people who produce value for everyone else make money. Billionaires would be celebrated as national heroes in CapitalismStan. Lastly, this author lambasts our current capitalists for producing goods that make us "zombies" well they should look in the mirror because capitalism only are delivering the goods that the consumers want to buy.

119 points by ArekDymalski 13y ago

ffrryuu 13y ago

Anything that grows infinitely is cancer.

icebraining 13y ago
What about human knowledge?
- ThomPete 13y ago
  Human knowledge can't grow infinitely.
  - maddddddddddddd 13y ago
    P=/=NP
  - jlgreco 13y ago
    Strictly speaking, neither can cancer. Both are limited by the capacity of the host.
    - ffrryuu 13y ago
      And so is capitalism/growthism.
swombat 13y ago
Cancers don't grow infinitely. They stop when the host dies. Entropy, on the other hand...
- eli_gottlieb 13y ago
  Goddamnit, entropy.

quadrangle 13y ago

Capitalism is itself based on constant growth. There is a fundamental misunderstanding with this article (and most of our society) and that is the conflation of capitalism and a free market. A truly free market is not necessarily capitalist, and actually capitalism doesn't lead to free markets. This confusion is messing up everyone's thoughts. What we like is the free market, the natural bottom-up interactions that help determine prices and such. Free markets have nice features. Capitalism is about profit and growth and the instant you think it isn't going to fail, everyone might as well speculate like crazy (why not? if it isn't going to fail…). The only way for capitalism to work is for everyone to realize that it is inherently unstable and likely to fail. And that realization is true also. We can still advocate for market freedom without advocating capitalism.

chamblin 13y ago
>> A truly free market is not necessarily capitalist Can you elaborate?
dnautics 13y ago
>Capitalism is itself based on constant growth That's not quite true. Capitalism is based on the principle that "the accrual of wealth (capital) is a virtue unto itself". This does not entail any level of growth. Free-marketism is a bit lighter, based on the principle that "making a profit is an indicator that you are providing social goods efficiently". It's really neoliberal capitalism (largely via neokeynesianism - but notably not what Keynes said himself, necessarily) that has espoused growthism. The austrian school does the best at presenting a critique of this neoliberal capitalism, but unfortunately the ranks of austrianism are also populated by people who don't believe in limited resources and environmental catastrophe, and don't talk enough about how growthism really screws over the poor via inflation. And also the austrian school is polluted by crazy goldbugs, who have the story half-right but run like hell with the wrong half.
Ensorceled 13y ago
"Capitalism is itself based on constant growth." No, constantly increasing profits or shareholder value are based upon constant growth. Capitalism does not require constantly increasing growth of profits to be "capitalism". This "corporations must constantly grow" is, along with "corporations must, by law, sociopathically seek profit", the major reason that American style capitalism isn't viable. It eats it's young.

johnrob 13y ago

I see this type of thinking a lot, sometimes even within myself. I don't think the problem is Capitalism (or "Growthism") - it's that we don't do much as we could to counter act the negative effects. Instead of worrying about the rich/poor divide, we could instead try to improve conditions for those on the bottom (food/shelter/health are all good starting points).

dnautics 13y ago
But the point is that "trying to improve conditions for those on the bottom" will never pan out, because the effects of growthism on the poor are compounding, i.e. exponential, and at best those things you are trying to improve the lot of others, scale linearly. Things get really bad when you do things like government welfare, which provides a linear benefit to the less fortunate while enriching the rich and polticially connected far more (indirectly, through deficit spending).
- cromwellian 13y ago
  That's false. In the limit, you could have 100% of the population unemployed, robots manufacturing everything and have the robots and robot factory owners taxed at 99.9% FICA, paying social security to everyone at birth. This scenario has been covered by quite a few "post-work" authors, who look at humans returning to a hunter-gather society. See Hans Moravec in _Mind Children_ for example. We used to walk around and these marvelous automated machines produced everything for us: nuts and fruits from trees, free for the picking. In the future, we'll walk around, and robots will be churning out the equivalent of fruits and nuts from factories. The modern concern of labor arises from the industrial revolution.
  - dnautics 13y ago
    It's not a growthist system, though, if previously accrued tax receipts are used to pay out the welfare you're describing. What would make it growthist, is if the welfare is paid for by borrowing, which would require compounding interest to pay it off. That the payback requires interest (which compounds, i.e. grows) implies growth in the overall productivity of the system to continue functioning. Moreover, if you consider these post-work humans to be "poor" something strange is going on in your head. It's easy to conflate "unemployed" with "poor" because that's generally the case in our society. But I wouldn't consider the humans in your "limit case" (with my growthist modification) to be the poor people being screwed over by the growthism. It's the robots.

dragonwriter 13y ago

I am endlessly amused by people pointing to features that the socialists who came up with the word "capitalism" to name the system they were criticizing criticized capitalism for and saying "this isn't capitalism". But, no, the features that are being complained about as "growthism" -- the idea of being "willing to sacrifice everything for more growth" -- is exactly a feature of capitalism that those 19th Century socialists who coined the term "capitalism" were criticizing. See, inter alia, Karl Marx. "Effect of Capitalist Competition on the Capitalist Class[,] the Middle Class[,] and the Working Class", in Wage Labour and Capital at http://www.marxists.org/archive/marx/works/1847/wage-labour/ch09.htm http://www.marxists.org/archive/marx/works/1847/wage-labour/...

dnautics 13y ago
One could make the argument that free marketism inevitably brings about capitalism which inevitably turns into growthism. Much like Benjamin Tucker's argument that Marxism inevitably ends in Stalinism (he made this argument as a contemporary of Marx, so this wasn't hindsight). I happen to actually believe Schumpeter's model better (that capitalism turns to gas and water socialism turns to growthism). It is, however, telling, that there are plenty of free-marketers who espouse essentially the same argument as Mr. Haque, for example the Austrian school of economics (which is full of kooks for other reasons). Chris Martenson (who called the 2008 crash) is another.
- dragonwriter 13y ago
  > One could make the argument that free marketism inevitably brings about capitalism which inevitably turns into growthism. I wouldn't make the first part of that argument, because I'm not convinced that "free marketism" is even a real thing, much less a precursor of capitalism. It seems to be position presented as a rhetorical defense of capitalism, but doesn't seem to exist independently. But what this article calls "growthism" is one of the core features of capitalism called out by the people who named it. Capitalism doesn't inevitably turn into growthism, it is (or, at least, includes as an essential feature) growthism. > Much like Benjamin Tucker's argument that Marxism inevitably ends in Stalinism (he made this argument as a contemporary of Marx, so this wasn't hindsight). Stalinism -- or, more to the point, Leninism -- requires both Marxism and an environment that is unlike the ones described by the descriptive elements of Marxism in a particular way into which one attempts to translate the prescriptive elements. Given those ingredients, I'd agree that its pretty much inevitable that something like Leninism will at least be attempted. Marxism itself doesn't inevitably become Leninism/Stalinism, but its existence makes the existence of such a system quite likely. > I happen to actually believe Schumpeter's model better (that capitalism turns to gas and water socialism turns to growthism). I would argue more that the empirical evidence is that capitalism plus the existence of socialist ideas leads fairly usually (even if not inevitably) to a variety of mixed systems that feature a basically capitalist structure with socialist elements (including growthism), of which "gas and water socialism" is an example.

apsec112 13y ago

This mostly makes two points: 1. America is screwed up. But we know that. 2. Arguments from My Opponent Believes Something: http://slatestarcodex.com/2013/06/13/arguments-from-my-opponent-believes-something/ http://slatestarcodex.com/2013/06/13/arguments-from-my-oppon... Eg.: "1. Argument From My Opponent Believes Something, Which Is Kinda Like Believing It On Faith, Which Is Kinda Like Them Being A Religion: “The high priests of the economic orthodoxy take it on faith that anyone who doubts the market is a heretic who must be punished.”"

grecy 13y ago

> So maybe, then, it’s time for you and I to leave this cult...The cheap, plastic junk that surrounds us probably isn’t worth what we paid – not just in cash (or, more likely, credit) to get it, but in freedom, time, and tears. This strikes a chord with me at a very deep level. A few years back I was completely disillusioned with living and working in a big city, basically just to buy more stuff. It still boggles my mind we all go to work 40 hours a week then come up with more and more creative ways to waste that excess of money, rather than just work less and have more time. I sold everything, quit my job, and spent 2 years driving from Alaska to Argentina, living in my tent and cooking on my little travel stove. My perspective on the world has changed immensely, and I now live in the very far north, grow and hunt/fish my own food, and only go to work enough to have the quality of life I want. That's usually around 2-3 days a week, depending if I want a new toy that month (rifle/camera/etc.) I highly, highly recommend people take a break from consumerism for an extended period of time and see how fulfilling your life can be without all that stuff. Some of the happiest people I've ever met in my life have nothing by North American standards.

pieterhg 13y ago
It's an outdated system which is not relevant anymore. Luckily you and many people like you are increasingly duscovering this life does not equate to happiness and in many cases actively avoids reaching happiness (e.g. 9-5, office hierarchies and debt)
- vasilipupkin 13y ago
  I would like to point out that going to work only 2-3 days a week and hunting/growing your own food is likely to get stale very quickly if you ever decide to start a family.
  - grecy 13y ago
    The exact opposite is true. The whole point of having a family is to spend time with your family, which you can do when you're not at work all the time. The very vast majority of people up here living the simple life are families.

cromwellian 13y ago

This is a rather incoherent rant. Growth = Bad. What's bad is if growth is achieved by irrevocable destruction of the environment, or deterioration of the human condition. It's not growth itself that is the problem, for there are many kinds of growth. Growth in physical inputs? Energy use? Labor? Outputs? Value (GDP)? Some of these counter-balance the other. If efficiency goes up (productivity), there is less need for labor, but it could also mean less physical inputs required, less energy, etc, so good for the environment. Also, the increased surplus means that labor can enjoy more fruits of its produce (in theory). And growth in value is another thing entirely, because it is a human value assigned by our minds, not an objective physical quantity. Just take virtual/digital goods, someone can make one awesome piece of software, or a game, that the whole of humanity values tremendously high, but which has O(1) marginal costs to produce for each person, and which took relatively few inputs. If I suddenly uploaded the entirety of humanity into the Matrix, all of a sudden, value can continue to increase, without continued use of environmental resources beyond the energy needed to run it. Today, if I make a piano, I have to cut down trees and use tons of energy, so for everyone on the planet to own a piano would be very bad. But if I make a virtual piano, everyone on the planet can have one at relatively low cost, and then the question simply falls to how good the simulation can be. I'd analogize Capitalism to evolution in an ecosystem. The entities within the system can grow, change form, multiply, and die. If they grow too much too fast, they can deplete their resources too quickly to sustain their population. They must have wild swings between mass die-offs and mass growth, or they might have a relatively stable pattern with low volatility, but while growth is slowed, they still have competition, they have not "switched off" evolution. I don't think growth is bad if it comes from increasing efficiency, or an increase in value because of completely new inventions. Perhaps same physical inputs that could produce a device in 1950, produces something in 2010 that I value a lot more. It is the organization of matter, it's pattern, the information content of it, that can grow with infinite variation and which we can continue to demand.

dnautics 13y ago
I don't think the article makes the claim you think it does. Growth is not the same as growthism.

twoodfin 13y ago

This is so bad it makes my brain hurt trying to respond to it. We should be upset that our society has managed to put in our pockets supercomputers connected wirelessly to the world's knowledge? Ah, I see, they'll turn us into "fat miserable drooling zombies". Luckily, in this world of "skyrocketing" poverty, surely only the top 1% can afford such indulgences, right? It's not as if innovation and a growing economy have put them in the hands of more than a hundred million Americans. Oh dear, I guess the zombie apocalypse is nigh. This guy's Twitter feed[1] is more or less a constant stream of invective directed at "billionaires", like this: The billionaires believe the greatest threat to freedom is society. But a free society's great threat is billionaires. Let's say you had THREE BILLION DOLLARS in the bank. Would you really give a fuck if it was...2.75? That's like counting toilet paper! He's a clown, and it's embarrassing that HBR thinks he's valuable as a contributor. [1] https://twitter.com/umairh https://twitter.com/umairh EDIT: And in case there was any question about where he actually stands on capitalism, from a whole three days ago: So now the fashion establishment calls designers with real vision, like Westwood, "eccentric". Ah, capitalism. Fuck you so much.

davidw 13y ago
I'm not much of a fan of his either: https://news.ycombinator.com/item?id=176780 https://news.ycombinator.com/item?id=176780 But you might tone it down with the name calling.
- twoodfin 13y ago
  I'll spend some time trying to come up with a fairer term than "clown", but it's hard when I come across gems like: Goddammit I love rolling into hipster cafes at 7:30 am and making them burn with racist anger.
  - jlgreco 13y ago
    What the hell does that even mean?
    - 13y ago

patmcguire 13y ago

My first thought when I saw the article title was "I bet this is by Umair Haque," and I was right. This is sort of what he does. How to fix the world is interesting, though http://howtofixtheworld.org/ http://howtofixtheworld.org/

ThomPete 13y ago

It's not Growthism per se but the lack of acknowledgment that growth needs to be taxed in a way that it still benefits society without taking the incentives away. That balance is lost in the US and people gets rich way beyond their risk. It can be fixed but it will require different taxation system IMHO.

websitescenes 13y ago

I agree with most of this article except for the main point; I think that "Growthism" and capitalism are synonymous. Growthism seems to be a scapegoat for the very real short comings of capitalism. Fact is that capitalism requires constant growth or it will fail. The real issue is valuing private property over the sacred right of life and that is what CAPITALism means.

dnautics 13y ago
no, captialism is valuing the accrual of property as a virtue in and of itself, not necessarily above or even competing with valuing human life. That growth is required as a part of the economic model is actually a rather modern concept that post-dates the development of capitalist philosophy, and accompanies the emergence of secular inflation as a matter of public policy. If you would like to understand how growth is "built in" to the economic system as a matter of policy and structure (and has nothing to do with capitalism per se), I would strongly recommed three resources: 1) Zeitgeist takes a left-ish perspective, and unfortunately is diluted by a lot of conspiratorial nonsense, but importantly its description of the money system is more or less correct. 2) Chris Martenson's "crash-course" is centrist, and very very good, but also very long and tedious. 3) Hidden Secrets of Money (video 4 in particular) takes a more right-leaning approach, and is tainted by the fact that the guy is obviously trying to sell you gold and silver, but the description of the money system is spot on and he strongly makes the point that growth is required. It's also the most concise and well-produced of the three.
- PavlovsCat 13y ago
  > captialism is valuing the accrual of property as a virtue in and of itself Accrual: The act or process of accumulating; an increase. Am I missing something? How is that not "growth"? If someone has more and more, the number of things they own has to keep growing. [I put growth in quotes because I think there is a world of difference between a tree or a person growing, and bank accounts or "places to put stuff" (see Carlin et al.) growing.] > not necessarily above or even competing with valuing human life I would argue that even the focus on property - owning things just for the sake of owning them, as opposed to making, using and sustaining things (not just objects, but also ideas and living beings) for the sake of furthering life - goes against the humanity and aliveness of the person subscribing to that view. Moreover, since we're nowhere near being able to turn energy into matter, to conjure property out of, say, the energy that gets hurled around space by suns and such, property often has to come from somewhere. Not strictly necessarily, but quite often in practice, it means taking things that someone else owned, or could potentially own; wherever we're dealing with finite resources, amassing property must make the rest poorer. Sure, that's not an objective in itself, "just" an unavoidable side-effect. Kinda like alcoholism is "just" wanting to be happy/drunk, not wanting to feel miserable or making others miserable. 10 for noble intentions, 0 for intellectual honesty. Yes, it is theoretically possible for such an addiction (to own more for the sake of owning more) to at least harm no other beings than the ones suffering from it. We may get there some day. We're not there, at all.

tytso 13y ago

Think about what happens to the stock price of a company once it stops growing. It falls through the floor. It could be making enough money to pay all of its employees, and making the world a better place, but if it doesn't grow, then if it has already gone public, the stock price sinks, and all of the employees who hold stock lose a lot of money. If it hasn't gone public, then the VC's get really upset. An example of such a company was Cygnus Support, which was in no danger of going out of business, and it was supporting a hundred or so engineers and their families, which were producing high quality open source code (such as GCC, gdb, etc.) so it was certainly making the world a better place. But it was considered a failure because it didn't give the VC's a lucrative exit. That's growthism. Fortunately for Cygnus's VC's, finally Cygnus got bought by Red Hat many years later. But Red Hat is going to end up in a similar boat; as a public company, if it can't figure out a way to sustain an significant growth every year, forever, the stock price will get punished. And of course, the problem is that companies can't produce a sustained compounded growth forever, because sooner or later compounded growth will cause the company's required revenues to exceed the world's GDP. So the trick is to stay on the rocket ship as long as you can, and then sell the stock to a greater fool before it tips back towards earth. And that's growthism, too....

refurb 13y ago
Of course the stock will get punished, since the price of a stock is mostly based on future earnings. If a company had a growth trajectory of A and now it's a lower trajectory of B, the stock price should drop.
anonymous 13y ago
So then isn't the sustainable option to grow until you can, then leave the last stages of "grow, crash, burn" to some fool and then start the exact same company but with a different name (i.e. RougeChapeau) and recapture your old market by doing exactly what you used to do, but now you're in a growth position compared to your old self that crashed and burned?
logn 13y ago
> Think about what happens to the stock price of a company once it stops growing. It falls through the floor. I don't entirely agree. Companies which can earn stable profits and distribute those as dividends remain healthy stocks. Their stock prices might remain flat, but with dividend payments there's always a natural floor at which a stock will fall to, and no one's really holding them to make a profit on the sale of the stock (the stock price is more of a safeguard in case the companies cut dividends or you decide to liquidate to move your money). The key is finding companies which can sustain profits and those are often businesses with pricing power to keep up with inflation and competition. Here's a great blog: http://www.dividendgrowthinvestor.com/ http://www.dividendgrowthinvestor.com/ His posts go back for years, and he's very focused on researching companies which have paid strong dividends for years/decades. It's an enlightening blog, especially after being surrounded by tech companies which rarely pay dividends and have stock prices based on growth potential (but Oracle, Intel, MS, etc. have transitioned to dividend paying companies).

devinmontgomery 13y ago

Interestingly, the article appears behind a registration-required modal window, but you can read the whole article by scrolling down and leaving the window in place.

maddddddddddddd 13y ago

capitalism based on a fiat currency isn't capitalism... you're as rich as you believe you are, so you can grow as much as you believe you can. the problems arise when your beliefs are based on lies.

avn2109 13y ago

This is something I've been wondering about for a while: To what extent are our economy and stock market merely ponzi schemes that require continued population expansion? If growth slows down/reverses/stops, is the era of easy profits finished? Or in other words, what will happen to my total-market ETF shares if population growth slows/stops? Is this an argument for investment in the developing world?

deleted 13y ago

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oakaz 13y ago

you guys are poisoned with a lot of thrash that make no sense. and here is your receipt: 1. Go to Bulgaria. 2. Get a bike. 3. Bike to Barcelona by following the Danube River. And see what the fuck capitalism is. It's the root of evil that turns villagers to slaves of companies that makes profit by filling everywhere with corn fields.

AJ007 13y ago

Irregardless of your political ideologies there are two roots to this issue which the author of this blog post seems unaware of: 1 - Government policy 2 - Central bank policy Your 401k, pension fund, home, are all dependent on prices increasing in order for you to retire or be financial secure. It just happens that if you did really well with your investments someone who has more investments than you did even better. If leverage is involved, not only do you fail to get a positive return on your investment you not only lose that asset but potentially everything else you have. Some of this policy extends beyond government subsidized lending toward things that are very looked down upon by modern Western society such as colonialism and genocide. As a civilized individual imagine yourself playing a computer game like Civilization. What strategies are you going to implement to grow bigger, get a better score, and continue playing the game?

panarky 13y ago

The author asks an honest and important question: Is capitalism failing at being the best possible means of organizing human work, life, and play? We've seen so many examples of market failure that it should be obvious that the market system is not a good answer to every problem. And when other nations chart a different course and deliver better outcomes for their citizens, that should trigger some critical questions. Failing to examine the beliefs and assumptions that public policy is built on, in the face of overwhelming evidence that those beliefs are false, really is magical thinking and cultish.

holograham 13y ago

The beautiful part of CapitalismStan is that no one becomes rich unless they in turn enrich the lives of others. Aka they produce a good/service that consumers want to freely purchase. He can rant about twisted incentives that government imposes on the free market but I can never understand why anyone can lambast capitalism when only people who produce value for everyone else make money. Billionaires would be celebrated as national heroes in CapitalismStan. Lastly, this author lambasts our current capitalists for producing goods that make us "zombies" well they should look in the mirror because capitalism only are delivering the goods that the consumers want to buy.