Growing, growing...GONE!

I am a simple fellow who is inclined to believe that economies can’t possibly grow forever and sees that more growth only means more consumption. Therefore I kind of cringe whenever I hear anyone talk about “economic growth” as a positive thing. Am I wrong to feel this way? Is there no way to have a “good economy” without growth?

Yes, technically. But it requires no population growth and extremely top-down control on the economy, production and consumption. I’d be willing to offer that such is impossible.

It is one of the eternal contradictions of a capitalistic economy that constant expansion is required to keep it moving in the right direction. Combine that with the fact that we’re stuck on one planet - at the moment - with a finite amount of resources and the endgame can be problematic. However, there’s little indication that we’re close to the edge now. Technological expansion and increased efficiencies make the need for greater resources less than it would otherwise be.

Now, efficiency has it’s limits. Being efficient with resources is what the ancients did when they abandoned unwanted infants or the elderly to die so they wouldn’t drag down others. Harsh, but practical and efficient. I, for one, would prefer to avoid such tactics in the future.

It’s an excellent question to ask and pursue answers to, not just regarding economics, but for a number of other aspects of human life as well.

If you think about it, there are a number of unspoken or rarely spoken about facets to this. Such as, that it is inherent to saying “economic expansion is good,” that you value human progress of various kinds, over other values. And then there are all the ways that “economic expansion” can be said to occur, which also carry with them, unspoken assumptions. There, we find things such as the current day ongoing debate about how “sloppy” to allow such expansion to be. How much pollution to allow. How much of possible problems in the future to be ignored. Which portions of the society to denigrate or make excuses for, and so on.

One of the big things here in the US, at least, is that it is expected that the economy “expands,” even if we have ZERO population growth. Life is supposed to get easier and cheaper and be new and more entertaining all the time.

Some of the economy is – well, hallucinatory.

Like collectibles. A ten cent comic book selling for forty thousand dollars. That’s part of the economy, but it has no “meaning” in objective terms. But it is a real economy: it gives people jobs.

(There’s the joke about the three guys stranded in the desert, and becoming millionaires by trading their hats back and forth.)

This kind of economy can grow, almost without limit. But it’s fragile. When beaver-fur hats went out of style, a hell of a lot of trappers lost their livelihood. This kind of economy can form a bubble…and pop.

It is relevant to the discussion, but it’s not an example of fashion-bubble economy. Beaver-fur hats went out of style (and trappers lost their livelihood), when the beavers were trapped-out.

It’s a big universe so I wouldn’t worry too much about growth.

The most fundamental economic principle is this: everyone poops.

You don’t really consume anything. You transform things from one arrangement to another. You yourself are such a temporary arrangement.

With the exception of meteors and a handful of spacecraft, nothing material ever enters or leaves the economy. We just move things around and rearrange them.

Energy enters the economy from outside. All energy ultimately comes from the sun or radioactive decay. Neither one of those sources is going to run out for millions of years.

I learned that a little differently, I think.

The most basic economic truth I was taught is: “Everyone always wants more.”

It’s not about what materials or energy are available - both are finite or transformable into things we can’t easily use again - it’s about demand and people’s behavior. There are several studies that indicate people’s unhappiness is relative. Regardless of their wealth, most people look to the things they don’t have and are unhappy about that.

The drive to acquire resources is a strong one and it’s the drive that leads to an expansionistic economy. Overcoming that is a problem and to have a steady-state economy we’d need to do so.

It has long seemed to me that capitalism is a giant Ponzi scheme. We must run out of natural resources and then it will all go poof. Someday. But I won’t be around to see it.

Well, no. Not exactly. But limited resources - and an expanding population - require more efficient and innovative use of resources. Recycling, new technologies, reduce-reuse-recycle all have their place in helping expansion along.

In the long run, will it run down? Sure. But as they say, in the long run we’re all dead.

Still, it wouldn’t be a bad idea to start truly working on harvesting asteroids and solar power and such. That’ll keep things moving for quite a while. Limiting the birth rate - which more developed countries seem to do on their own as per-capita wealth increases - is a good idea, too.

Take this “I want more” need. You can see it on games like World of Warcraft. Except if you’ve got an Infinity +1 sword, it doesn’t take any more real resources to craft an Infinity +2 sword. Just like paying $1 million for that Action Comics #1 doesn’t create or destroy anything.

In some ways framing economic growth as “the numbers always have to get bigger” is wrongheaded. That’s looking at the cost of everything produced. But the real value is in using the things produced. If you make 52 shoes that cost $10 and last a week, that’s an economic output of $520. If next year you make 1 pair of shoes that cost $100 and last a year, that’s an economic output of $100. Oh no, our economy shrank by $420! Disaster! Chaos! Except you still have the same amount and quality of foot covering over the year.

So the price paid for all the goods and services produced in a year is an imperfect metric for economic utility, the only reason we use it is because it’s much easier to collect that metric.

No, I’m not sure that’s held up, Lemur. In the shoe scenario you described note that in the $100 shoe scenario only one person gets shoes. In the other you’ve increased marginal utility by 52 sets of shoes, regardless of quality. You have, also, used more resources - shoe leather, glue and so forth - so serve a greater amount of people.

It’s important to note that there’s a difference between monetary value and wealth, here. Two sets of shoes - from your scenario - can accomplish the same thing and that can be wealth. But they can have different monetary value for a variety of reasons - material, marketing, scarcity - that can have some, most or no relation to actual utility and wealth.

Caveat - I am not educated in this discipline at all, these are armchair thoughts.

ISTM there are 2 factors that can contribute to the fuzzy notion of “infinite growth” in a non-harmful way:
[ul]
[li]New people are being born and entering the system as economic actors. Whereas other people are getting older and diminishing their impact as economic actors. It doesn’t necessarily require MORE people being born, only that the replacement actors are more active.[/li][li]Productivity seems to be always increasing, squeezing more growth out of the same amount of effort.[/ul][/li]
To me, both of those can increase growth without pushing toward some imagined cliff.

Someone should mention Jared Diamond’s book Collapse, which looks at why societies fail and collapse, including looks at modern socieities. He also mentions three 'success stories" where collapse was avoided, without totalitarian central control:

The processes of Collapse and perpetual growth are inevitably linked. It’s not just that tangible resources are limited – time is, as well, and at a certain point it becomes absurd for certain entities to grow once they’ve effectively saturated the market).

Yes the economy can keep growing, whichever way you spin it.

If we’re only including tangible objects, well humans have barely scratched the surface of one speck of dust in the universe. There’s a lot of scope for scaling up everything we do by countless orders of magnitude before the universe would notice.

But of course many ways we add value to human life are not by making more “stuff”. It’s services, and software, or new methods for achieving some goal. And the things of highest value to us more and more fit into this latter bracket.

And of course the world economy has grown. While we take a lot of notice of the slumps, it’s actually an incline most of the time with relatively shallow dips now and then.