Thanks Ed,
Thought I'd post some paragraphs from his writings on Steady-State
Economics. Bold italics my emphasis:
Natalia
http://dieoff.org/page88.htm
*The Hair of the Dog that Bit You*
One of the most popular arguments against limiting growth is that we
need more growth in order to be rich enough to afford the costs of
cleaning up pollution and discovering new resources. Economist Neil
Jacoby says, "A rising GNP will enable the nation more easily to bear
the costs of eliminating pollution" (1970, p. 42). Yale economist Henry
Wallich makes a similar point:
The environment will also be better taken care of if the economy grows.
Nothing could cut more dangerously into the resources that must be
devoted to the Great Cleanup than an attempt to limit resources
available for consumption. By ignoring the prohibitionist impulse and
allowing everybody to have more, we shall also have more resources to do
the environmental Job [Wallich, 1972 p. 62].
No one can deny that if we had more resources and were truly richer, all
our economic problems would be more easily solved. The question is
whether further growth in GNP will in fact make us richer. It may well
make us poorer. How do we know that it will not, since we do not bother
to measure the costs and even count many real costs as benefits? These
critics simply assume that a rising per-capita GNP is making us better
off, when that is the very question at issue!
If marginal benefits of physical growth decline while marginal costs
rise (as elementary economic theory would indicate), there will be an
intersection beyond which further growth is uneconomic. The richer the
society (the more it has grown in the past), the more likely it is that
marginal benefits are below marginal costs and that further growth is
uneconomic. That marginal benefits fall follows from the simple fact
that sensible people satisfy their most pressing wants first, whether in
alternative uses of a single commodity or in alternative uses of income.
That marginal costs rise follows from the fact that sensible people
first exploit the most accessible land and minerals known to them, and
that when sacrifices are imposed by the increase of any one activity,
sensible people will sacrifice the least important alternative
activities first. Thus marginal benefits of economic activity fall while
marginal costs rise. Were this not the case, our previous "economic
activity" would not have been economic--less pressing wants would have
to have taken priority over more pressing wants, and the level of
welfare could have been increased by reallocation with no increase in
resources used.
...Once we have gone beyond the optimum, and marginal costs exceed
marginal benefits, growth will make us worse off. Will we then cease
growing? On the contrary, our experience of diminished well-being will
be blamed on the traditional heavy hand of product scarcity, and the
only way the orthodox paradigm knows to deal with increased scarcity is
to advocate increased growth--this will make us even less well off and
will lead to the advocacy of still more growth! Sometimes I suspect that
we are already on this "other side of the looking glass," where images
are inverted and the faster we run the "behinder" we get.
/*Environmental degradation is an iatrogenic disease induced by the
economic physicians who attempt to treat the basic sickness of unlimited
wants by prescribing unlimited production.*/ We do not cure a
treatment-induced disease by increasing the treatment dosage! Yet
members of the hair-of-the-dog-that-bit-you school, who reason that it
is impossible to have too much of a good thing, can hardly cope with
such subtleties. If an overdose of medicine is making us sick, we need
an emetic, not more of the medicine. Physician, heal thyself
Consistent Inconsistencies and Avoiding the Main Issues Growthmen are
forever claiming that neither they nor any other economist worth his
salt has ever confused GNP with welfare. Consider, however, the
following four statements from the same article (Nordhaus and Tobin, 1970):
(1) Gross National Product is not a measure of economic
welfare....maximization of GNP is not a proper objective of economic
policy....Economists all know that...[p. 6].
(2) Although GNP and other national Income aggregates are imperfect
measures of welfare, the broad picture of secular progress which they
convey remains after correction of their most obvious deficiencies [p. 25].
*(3) But for all its shortcomings, national output is about the only
broadly based index of economic welfare that has been constructed [p. 1,
Appendix A].
*(4) There is no evidence to support the claim that welfare had grown
less rapidly than NNP.
Rather NNP seems to underestimate the gain in welfare, chiefly because
of the omission of leisure from consumption. Subject to the limitations
of the estimates we conclude that the economic welfare of the average
American has been growing at a rate which doubles every thirty years [p.
12].
It is asking too much of context and intervening qualification to
reconcile statement 1 with statements 2,3, and 4. Either GNP (or NNP) is
an index of welfare, or it is not. The authors clearly believe that it
is (in spite of the first statement). They offer many sensible
adjustments to make GNP a better measure of welfare on the assumption
that, although imperfect, it is nevertheless a measure of welfare. But
all of this avoids the fundamental objection that GNP-flow is largely a
cost. Wants are satisfied by the services of the stock of wealth. The
annual production flow is the cost of maintaining the stock, and though
necessary, should be minimized for any given stock level. If we want the
stock to grow, we must pay the added cost of a greater production flow
(more depletion, more labor, and ultimately more pollution). Depletion,
labor, and pollution are real costs that vary directly with the
GNP-throughput. If we must have some indices of welfare, why not take
total stock per capita and the ratio of total stock to throughput flow?
Welfare varies directly with the stock, inversely with the flow. Beyond
some point, the benefits of additions to the stock will not be worth the
costs in terms of additional maintenance throughput.
Kenneth Boulding has for many years been making the point that Gross
National Product is largely Gross National Cost and has never been taken
seriously. If this way of looking at things is wrong, why does not some
economist deal it a decisive refutation instead of avoiding it?
Certainly it is not a minor issue.
The source of this flow fetishism of orthodox economics is twofold.
First, it is a natural concomitant of early stages of ecological
succession (Odum, 1969). Young ecosystems (and cowboy economies) tend to
maximize production efficiency, that is, the ratio of annual flow of
biomass produced to the preexisting biomass stock that produced it.
Mature ecosystems (and spaceman economies) tend to maximize the inverse
ratio of existing biomass stock to annual biomass flow that maintains
it. The latter ratio increases as maintenance efficiency increases.
Economic theory is lagging behind ecological succession. The other
reason for flow fetishism is ideological. Concentrating on flows takes
attention away from the very unequally distributed stock of wealth that
is the real source of economic power. The income flow is unequally
distributed also, but at least everyone gets some part of it, and
marginal productivity theory makes it appear rather fair. Redistribution
of income is liberal. Redistribution of wealth is radical. Politically,
it is safer to keep income at the center of analysis, because not
everyone owns a piece of the productive stock, and there is no theory
explaining wealth distribution. Putting stocks at the center of analysis
might raise impolite questions.
*Zero Growth and the Great Depression*
One of the more disingenuous arguments against the SSE [Steady State
Economy] was put forward by the editors of Fortune, who stated that "the
country has just gone through a real life tryout of zero growth" (1976,
p. 116). This was the period 19731975, a period remembered "not as an
episode of zero growth but as the worst recession since the 1930s."
Fortune identifies a SSE with a failed growth economy. A condition of
nongrowth can come about in two ways: as the failure of a growth
economy, or as the success of a steady-state economy. The two cases are
as different as night and day. No one denies that the failure of a
growth economy to grow brings unemployment and suffering. It is
precisely to avoid the suffering of a failed growth economy (we know
growth cannot continue) that we advocate a SSE. The fact that an
airplane falls to the ground if it tries to remain stationary in the air
simply reflects the fact that airplanes are designed for forward motion.
It certainly does not imply that a helicopter cannot remain stationary.
A growth economy and a SSE are as different as an airplane and a
helicopter. Growthmania reigns supreme when even the failures of a
growth economy become arguments in its defense!
*Conclusions from the Growth Debate*
To a large degree, the growth debate involves a paradigm shift of a
gestalt switch--a change in the preanalytic vision we bring to the
problem. Conversion cannot be logically forced by airtight analytical
demonstrations by either side, although dialectical arguments can
sharpen the basic issues. But as the growing weight of anomaly
complicates thinking within the growth paradigm to an intolerable
degree, the steady state view will become more and more appealing in its
basic simplicity. In any case, orthodox economics will not easily
recover from the weaknesses that some of its leading practitioners have
revealed in their efforts at self-defense. It is, to say the least,
doubtful that "the world can, in effect get along without natural
resources." But it is certain that the world could do very well indeed
without "the orthodox economists whose common sense has been
insufficient to check their faulty logic."
Ed Weick wrote:
One economist who brings the environment into economics is Herman
Daly. You might take a look at hm -- e.g. Beyond Growth.
Ed
----- Original Message -----
*From:* Darryl or Natalia <mailto:[email protected]>
*To:* RE-DESIGNING WORK, INCOME DISTRIBUTION,EDUCATION
<mailto:[email protected]>
*Sent:* Wednesday, July 14, 2010 5:48 PM
*Subject:* [Futurework] Ocean Thermal Energy Conservation
Before the Keynes discussions, and ensuing insults, emails were
quite interesting around the topics of mind and sustainable
economies. July 4, I was listening to Sir Nicholas Stern speaking
on David Suzuki's new CBC series on protection of the biosphere.
Some may know Stern was chief economist at the World Bank 3 years
ago, and has now come back to L.S.E. He feels that it is an
analytical intellectual mistake to separate environment from
economic growth; that we must work on the two together. Below, I
have posted his 3 year old recommendation, but since that time he
feels there is greater urgency to reduce our per capita carbon
footprint even more. As he said, Pearl Harbor was urgent, why not
this? That we can't wait for the painful experience of it to tell
us we're doing it wrong, for it will be too late. Blood shouldn't
be the motivator, yet we're unwilling to acknowledge what's
happening at 1C--deserts, oceans and forests changing so rapidly.
Next century, there's a 50/50 chance we could be facing 5C greater
temperatures, not seen for 30 million years.
He discussed some solutions; geothermal, tidal, even nuclear for
those who find it viable. Carbon reduction by legislation,
taxation. That it's toxic to put a price on carbon, but it's
essential. He feels it's a deep market failure not to put a price
on current oil generated energies, and that regulations reduce
emissions.
One of the websites I visited had comments posted below Stern's
own, and there were the expected conspiracy theorists debunking
global warming. One fellow voiced concern that reduction of red
meat consumption would help reduce methane more quickly by up to
1/5 of total. Don't know about that figure; I've heard varying
ones, but I agree that red meat is an industry that calls for a
huge reduction. Another fellow discussed Ocean Thermal Energy
Conservation (OTEC). That sounded really good to me. Abundant,
renewable and cheap. Would supply a lot of jobs, and it might help
cool down the oceans a bit, too, if we got moving on it now.
Ocean acidification and warming are the top two concerns of
oceanographers today. Sediments (chiefly from fertilizers) and
overfishing come in second, then non-biodegradables, as in plastic
trash. A new book by Alana Mitchell sounds interesting called "Sea
Sick"-- focuses on coral life at risk, and coastal dead zones
increase. Findings about how quickly life is going to disappear
without healthy oceans and forests are making oceanographers puke,
literally.
I think that things can be depressing when they are uncertain;
when fear takes over from an inability to act. We have a pretty
good idea of what's to come, and we have knowledge to act by. What
we need is collective will to force government to act responsibly.
So, anyone amongst us experienced at world petitions?
Natalia
>From 2006, found at:
http://news.bbc.co.uk/2/hi/business/6098362.stm
*The world has to act now on climate change or face devastating
economic consequences, according to a report compiled by Sir
Nicholas Stern for the UK government. *
*Here are the key points of the review written by the former chief
economist of the World Bank. *
*TEMPERATURE*
# Carbon emissions have already pushed up global temperatures by
half a degree Celsius
# If no action is taken on emissions, there is more than a 75%
chance of global temperatures rising between two and three degrees
Celsius over the next 50 years
# There is a 50% chance that average global temperatures could rise
by five degrees Celsius
*ENVIRONMENTAL IMPACT*
# Melting glaciers will increase flood risk
# Crop yields will decline, particularly in Africa
# Rising sea levels could leave 200 million people permanently
displaced
# Up to 40% of species could face extinction
# There will be more examples of extreme weather patterns
*ECONOMIC IMPACT*
# Extreme weather could reduce global gross domestic product (GDP)
by up to 1%
# A two to three degrees Celsius rise in temperatures could reduce
global economic output by 3%
# If temperatures rise by five degrees Celsius, up to 10% of global
output could be lost. The poorest countries would lose more than
10% of their output
# In the worst case scenario global consumption per head would fall 20%
# To stabilise at manageable levels, emissions would need to
stabilise in the next 20 years and fall between 1% and 3% after
that. This would cost 1% of GDP
*OPTIONS FOR CHANGE*
# Reduce consumer demand for heavily polluting goods and services
# Make global energy supply more efficient
# Act on non-energy emissions - preventing further deforestation
would go a long way towards alleviating this source of carbon
emissions
# Promote cleaner energy and transport technology, with non-fossil
fuels accounting for 60% of energy output by 2050
*GOVERNMENT RESPONSE*
# Create a global market for carbon pricing
# Extend the European Emissions Trading Scheme (EETS) globally,
bringing in countries such as the US, India and China
# Set new target for EETS to reduce carbon emissions by 30% by 2020
and 60% by 2050
# Pass a bill to enshrine carbon reduction targets and create a new
independent body to monitor progress
# Create a new commission to spearhead British company investment in
green technology, with the aim of creating 100,000 new jobs
# Former US vice-president Al Gore will advise the government on the
issue
# Work with the World Bank and other financial institutions to
create a $20bn fund to help poor countries adjust to climate
change challenges
# Work with Brazil, Papua New Guinea and Costa Rica to promote
sustainable forestry and prevent deforestation
------------------------------------------------------------------------
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