We are talking about two different kinds of bookkeeping. Economists were telling the physicists that their understanding of economic growth and the physicists' understanding of their own discipline were almost identical because they both used mathematical principles. The physicists mocked the economists' naïveté because physical laws mean maximization with respect to some conservation principle. That is what Maxwell's sneer was about. G-R was on the side of the physicists, arguing that economists' model of unconstrained growth neglected physicists' "bookkeeping" in the sense that the economists were ignoring the underlying physical law of entropy. I suspect that is what Gene was appreciating in this dialogue. Phil Morowski publishes a number of similar exchanges in which the physicists were exasperated by the economists' failure to recognize what they and G-R considered obvious. You might say that the physicists were arguing that economists had no comprehension of the kind of bookkeeping that was necessary for a scientific theory of economics.
Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [email protected] michaelperelman.wordpress.com From: [email protected] [mailto:[email protected]] On Behalf Of Julio Huato Sent: Saturday, August 24, 2013 4:42 AM To: Progressive Economics Subject: Re: [Pen-l] Mirowski & physics envy On Fri, Aug 23, 2013 at 9:03 PM, Perelman, Michael <[email protected]<mailto:[email protected]>> wrote: > I don't think Maxwell was agreeing with McCloud. I think he was sneering at > him. Ha. I do not have a way to read the mind of Maxwell when replying to McCloud, but I do know that physics is -- in a way -- sheer bookkeeping. > Phil's point is that economic has no conservation principle, creating a gulf > between economics & physics. As a result, economics presents a model of > unlimited growth, something that Geogrescu-Roegen emphasized, but his work > his much less influence than it deserved. If there's a person who showed the bookkeeping connection between physics and economics transparently was precisely Nicholas G-R. Cf. his EEJ 1986 essay on entropy and economics. Physics is (has to be) "human-centric" (and I believe this is textual or almost textual Nicholas G-R, whom I am citing here by heart). The conservation principle is based on direct practical, productive experience. It sets the resource constraint for the physical world. It says that, if you take a closed system, then there's no magic. And the universe is defined as a closed system. In fact, it is the only true closed system in physics. It excludes God. The universe has a given mass/energy budget, and in any physical process what gets in is what gets out. And social life is, in an obvious sense, a physical process. (The following passages are extracted from my book draft.) Society is a physical system. Though distinct from other physical systems, society exists in the physical world; it is a part of nature, and -- therefore -- it is subject to its laws. In the terms used in physics, society is an "open system," in that it continuously or recurrently takes matter (mass or energy) from its natural environment and uses it to generate and regenerate itself. Social life is a subset of the material movement of the universe. Our social life is a flowing form of physical matter, and -- as such -- nothing but the matter continuously absorbed from the rest of nature, and transformed into the physical objects we produce, which -- ultimately -- are ourselves personally and our artificial extensions: our material wealth. We are a part of nature -- a product of nature's evolution -- with some very distinctive characteristics. But, as powerful as we may be or become, our power will always be the derived power of nature. Our labor power is nothing but the power of nature that we humans have managed to capture or appropriate from nature. We may learn how to circumvent and use natural laws in our favor, but we cannot subtract ourselves from the conditions of the natural world in which we are embedded. This means that any form of society, any social structure conducive to the long-run development of human powers, must manage the fundamental relationship between human society and the rest of nature in a sustainable manner. A better management of our interaction with our natural environment can only result from a more profound and detailed understanding of the workings of the physical world, ourselves included. Basic results from the physical sciences can help us to properly situate social life in the broader context of the universe's physical processes. The fundamental law of physics, the first law of thermodynamics (also known as the conservation law) says that the total amount of energy in the universe is constant and that what varies is its composition across its various forms. This law extends also to any closed subset of the universe or closed physical system, with the universe itself -- by definition -- regarded as a closed system. The universe is in continuous motion. The second law of thermodynamics (or the entropy law) establishes the overall direction of this motion. It says that when energy is transformed within any closed system from one form to another, then matter (mass/energy) will tend to "degrade," in that the amount of entropy or disorder in the system will increase. Humans decide what, in physics, is low or high grade energy. The energy constitutive of life in general -- and more so of intelligent life and social life -- is deemed as "high-grade" or "highly-organized" energy while entropy is a state of energy unusable for human activity. Then, higher entropy means a lower usefulness of the natural environment for humans.3 3 It should be noted that life -- the more "organized," the more so -- is defined as energy on a path contrary to the increasing-entropy followed by the rest of the universe. This is a definition, and not a result of theoretical physics. The specific result of the second law of thermodynamics is that the usability of the rest of the universe for the reproduction of society decreases inexorably. One can hardly fault physics, a human scientific endeavor, for being human centered. As encapsulated in a phrase attributed to the Greek philosopher Protagoras: "Man [i.e. the human being] is the measure of all things." As a result, of all the energy that human societies take in in a given period of time, only a portion is transformed into social life. The remainder is emitted back into the rest of nature as higher-entropy energy than the energy that feeds originally into society. The total input and total output of energy are equal, but on "average," the composition of energy on the output side will be of a lower grade than in the input side. The universe is paying a high "price" for producing and sustaining life, particularly human (social) life. Though generally speaking, life -- including social life -- is defined as evolving in a direction opposite to the increasing-entropy "arrow" of the rest of nature, i.e. from lower to higher organization, it does so at the expense of speeding up the overall degradation of energy that will eventually lead to the inevitable end of all life in the universe. More specifically, a portion of the mass or energy that society ingests (an increasing amount as human population and labor's productive forces expand) is returned to nature in the form of garbage; industrial waste; polluted air; heat concentrations in the lower layers of the atmosphere; contaminated waters; acoustic, visual, and electronic noise; etc. Instead of using the technical term entropy, we use the more common word refuse to refer to all these "low grade" forms of matter, i.e. matter that humans do not recover or recycle, but instead dump into the rest of nature. Clearly, since we depend on it, our dumping refuse into it degrades the natural environment, or makes it less useful to us, in that extracting natural resources -- and therefore, other things constant, production altogether -- becomes more costly to us, the productive forces of labor reduced accordingly. In sum: Refuse: Unwanted, non-reusable, or non-recyclable wastage; mass or energy emitted by human activities (production and consumption) that cannot be recovered for human use and that reduces the usefulness of the natural environment and, as a consequence, decreases human welfare, i.e. it decreases our labor power. Notice that the degree to which our society generates refuse (say, per person or per unit of wealth produced) is not fixed. The historical problem of collectively "choosing" optimal social structures, given our existing wealth, is in part the problem of how to use natural resources in ways that, other things equal, minimize entropy, as -- again -- entropy is defined in terms of the usefulness for us of the natural environment. A sustainable interaction with the rest of nature is increasingly a necessary product we need to produce. In the last few decades, it has become increasingly clear that human activities disrupt the natural cycles in our planet, including the climate. Our relationship with the rest of nature is a very complex process. We cannot easily regulate or control the overall impact of our social life in the rest of nature. So, given the stakes, we have to be particularly careful, because the forces that we unleash can backfire on us. We are all familiar with the changes in the planet's climate, with global warming, which is attributed to certain gases that we emit into the atmosphere that create a greenhouse effect on the planet and trap the heat in the biosphere, which then disrupts our weather patterns. This phenomenon, already in force, has the potential to cause even greater devastation to human societies, especially those that do not have the resources and technology to face these weather disruptions. That is why, increasingly, by omission and by action, we need to deliberately produce a sustainable relationship with the rest of nature. This has to be a conscious purpose and we then have to produce it, just like we develop blueprints to build houses and then we go ahead and build them in accordance with those blueprints. The output of this productive process will be a richer human society. Making us aware of this need is the merit of the modern environmentalist movement.
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