There’s a fundamental issue with western economics - our capitalist economy requires perpetual growth. This is because the way we create money is by fractional reserve banking - banks lend out money at interest, which has to be paid back later. There is never enough money in the system to pay back all of the outstanding loans with interest - it’s dependent on the belief that there will be growth and, in the future, more money loaned into the system. If you’re not convinced of that, I would recommend listening to the free program “The Crash Course” by Chris Martenson: http://www.peakprosperity.com/crashcourse.

 

He’s also got a book, or a shortened, 1 hour version of the program on his website, linked below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Perpetual growth means that every year we need to produce and consume more than we did the previous year in order to keep the economy functioning. For some, this sounds like a worthy goal regardless - by consuming more, people will be better off, right? But perpetual growth is only possible if you have unlimited resources, and we don’t. See, for example, the vast body of literature on peak oil.Increasing awareness of this issue has driven a body of alarmist economic  literature, with the above-linked to Crash Course and books like “The Limits to Growth” and “The End of Growth” as examples. They’re generally given short shrift by serious economists, however, who at least implicitly, and often explicitly, continue to argue for the possibility and advisability of perpetual growth. One of their main arguments is that people have been making the argument that growth can’t last forever for a long time, and we’re still growing now. The alarmists were wrong before, and so they’re probably wrong now.

 

Now, this seems like faulty logic to me - like someone claiming that a falling plane is about to hit the ground, the alarmists will continue to be wrong until they're right, but once they're right, nothing else will matter. So, I’m somewhat concerned by all of this, but not quite to the level that the alarmists are. Plus, I’ll be the first to admit that I might be wrong. After all, I’m generally pessimistic about a lot of features of modern society, and there’s a sick little thrill that I get from thinking that it’s all about to go belly-up. I think other people feel this way too, which partially explains the prevalence and popularity of post-apocalyptic fiction. My father, who’s a conservative economist, thinks that my problem in considering the future of our economy is that I lack the imagination to see what form future growth could take, and I accept this as a valid critique. Maybe we really will survive running out of oil, and the invisible hand will drive us to more renewable energy production. Maybe, when the robots take all of the jobs that currently exist, we’ll come up with new jobs to employ people. Maybe we’ll soon be able to colonize other planets and extract resources from them - this would allow growth to continue for a long time, if not forever.

 

So, in spite of my concern, I don’t advocate the building of doomsday bunkers and bug-out-bags. Even if the alarmists are correct, we have no real idea when we’ll actual hit the limits to growth and things will start going off the rails, and I don’t think we have any real idea what that future would look like. If food production drops and there are food riots in American cities and around the world, okay, I might be able to prepare for that. If global conflict increases because of diminished resources, triggering a nuclear World War III? That’s a completely different scenario, and most of the people who spent years agonizing over how to survive the apocalypse will be vaporized before they even get a chance to show off their fire-making skills.

 

And while we should be trying to make our economy more sustainable, we shouldn't pretend that hunter-gatherers were always a great model to follow. Hunter-gatherers could thrive for long periods of time when they used, but did not exploit, their environments. This was the case for millenia - we were good at hunting and foraging for food, but not too good. If our ancestors killed enough animals to feed their tribe, but not to expand or grow their tribe, they could live for generations as part of a functioning ecosystem. But, given our native intelligence, humans eventually got too good at killing, and we started growing. Hunter-gatherers spread out and multiplied, which made farming inevitibly more valuable. They couldn't see that their growth made them vulnerable in different ways. But we can.

 

What we do advocate is the creation of stronger communities, and focusing our intelligence on creating a sustainable economy. Stronger community networks will help us flourish in the modern economy, and if that economy fails they’ll help us survive. There is a resilience in the idea of Federations that can help to weather a lot of storms.

Forever Growth, Inevitable Doomsday?

by Jackson Lay

August 7, 2014