"Steadily rising energy costs and decreasing net energy yields will simply not be able to fund the future economic growth and consumptive lifestyles that developed nations are depending on (and that developing nations are aspiring to). In fact, the persistent global economic weakness we’ve been experiencing over the past years is an expected symptom of the throttling constraint decreasing net energy places on growth." (Source: Peak Prosperity)
Chris Martenson’s excellent analysis of why there is not going to be enough net energy for the economic growth we want.
US economic growth will be less than 1% in the next fourty years according to a new analysis by famous American investor Jeremy Grantham. The contrarian investor sees resource scarcity and higher resource prices as well as demographic factors as the main reason why our global economies will continue to struggle for new economic growth. (Source: Business Insider)
As always the gloomy predictions of Mr Grantham’s piece make a lot of sense but will be neglected by the "don’t worry, be happy" myopic political and economic elites.
This interesting working paper written by the Grantham Research Institute on Climate Change and the Environment concludes that "continued economic growth is feasible and desirable, although not without significant changes in its characteristics.
These changes need to involve ultimately the reduction of the rate of material output, with continued growth in value being generated by expansion in the ‘intellectual economy’." (Source: LSE)
The Achilles heel of this thought-provoking paper lies in the fact that it starts from the fallacy that the "intellectuel economy" (the knowledge economy) has little or no material and resource implications.
On this and other fallacies about growth, read this brilliant article by Herman Daly.
"I address this subject having been convinced that the growth paradigm has no future and that some alternative vision is therefore needed as humanity begins its inevitable transition to a world beyond growth. I put forward the sufficiency economy as the most promising alternative model, although it is one that I believe may ultimately be imposed upon us whether we want it or not, for reasons that will be explained. We can go the easier way or the harder way, so to speak, depending on our attitudes and actions. " (Source: resilience.org)
Absolute must-read analysis by Samuel Alexander of the real economic alternative to the crisis.
“My point is that the sufficiency economy described above is not about turning off the lights and taking shorter showers. It is about embracing a fundamentally different way of life and a fundamentally different economy. If we do not voluntarily embrace these differences, however, and instead persist with the goal of universal affluence, then soon enough ecological and / or economic systems will collapse and we will be faced with fundamental change all the same, only with much more suffering. As I noted earlier, we can go the easier way (which will not be easy), or the harder way (which will be unspeakably tragic), depending on our attitudes and actions. We are free to choose our fate, and presently we are in the process of doing so.”
"One question that stops conversations cold is, ‘What if our greatest societal challenge is not climate but growth?’
Climate change is really just an ambiguous term or understatement for the problem at the root of our energy production and consumption, which is growth in energy use, economic/population expansion, and environmental degradation resulting in overshoot that is vulnerable to collapse.” (Source: Energy Bulletin)
Interesting reflections on how all the energy spent on dealing with climate change distracts us from the real root cause of our "great disruption".
“It is startling to find that Chinese people’s feelings of well-being have declined in a period of such momentous improvement in their economic lives.” (Source: NY Times)
Richard Easterlin in NY Times: China demonstrates that "growth alone, even at sustained, spectacular rates, has not produced the kind of life satisfaction crucial to a stable society — an experience that shows how critically important good jobs and a strong social safety net are to people’s happiness."
Another piece of evidence that it is time for a new economic and social development model. Read on the same subject “Does economic growth make you happy?”, a Times Literary Supplement review by Robert Skidelsky of the latest book “Economics after the crisis” written by Adair Turner.
For those in Brussels interested in this topic, there is a great conference organised by the ETUI on 15-16 October: “From ‘uneconomic’ growth to future well-being”
“Italian premier Mario Monti and French leader Francois Hollande on Tuesday said Europe must urgently restore economic growth and create jobs as part of a wider plan to safeguard the 17-country euro currency union.” (Source: Foxnews)
Politically elected or technocrat, left or right – Europe’s elites remain stuck in old and failed ideologies (growth as the miracle cure) instead of preparing for the Prosperous Way Down. With a European Union like that, who needs the European Union? Time to prepare the alternative (which is not a “retour” to grand old nationalism by the way ): Phoenix Europe.
Help our EU leaders awake from their naive dreams and send them this 8-minute video from the Post-Carbon Institute of Richard Heinberg: Who killed economic growth?
"Our decision-making elites may tacitly understand that growth has become uneconomic. But they have also figured out how to keep the dwindling extra benefits for themselves, while “sharing” the exploding extra costs with the poor, the future, and other species. The elite-owned media, the corporate-funded think tanks, the kept economists of high academia, and the World Bank — not to mention GoldSacks and Wall Street — all sing hymns to growth in harmony with class interest and greed. The public is bamboozled by technical obfuscation, and by the false promise that, thanks to growth, they too will one day be rich. Intellectual confusion is real, but moral corruption fogs the discussion even more." (Source: Energy Bulletin)
Herman Daly (ex-World Bank economist) provides another must-read article on the fallacies of economic growth and explains why the potential for "decoupling" is limited and why economic growth has become "uneconomical".
I”f we want the world economy to grow by 4% per year, world oil supply will need to grow by close to 3% per year. This is more than world oil supply has grown per year since the 1970s–giving a clue as to why the world is having so much problem with economic growth now.” (Source: ourfiniteworld.com)
Another must-read article by Gail Tverberg explaining the energy limits to economic growth, a factor not taken into consideration by any of the "expert" economists trying to work out solutions for the global economic and debt crisis.
"The rich and powerful are lining up to ensure that they protect the unfair share of the earth’s resources that they enjoy. Now that the finance scam has fallen apart they are adopting more direct strategies." (Source: Gaian Economics)
Excellent analysis By Molly Scott Cato on how the capitalist elites are protection themselves from the Great Disruption and how high-level conferences co-organised by business and the military are preparing for the new ecological and social class war.
“As nature proves to us daily that the scale of our economic activities threatens our future, those whose power depends on the existing economic model are using their considerable resources to manouevre themselves into a dominant position within the new paradigm. Having lately accepted that there are limits to resources, they now move to suggest that private interests are best placed to make decision about how those limited resources should be shared. This will ensure efficiency, we are told, while equity concerns are sidelined and the question of the appropriate forum for decision-making is entirely off the agenda.”