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« Why A Person Learns (and what it means for education) | Main | Could we solve two problems at once? »

August 17, 2010


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Good post -- I agree with what you wrote about energy and consumption. I see it happening here in the U.S. Throw in the rising populations of the world mix it with consumption and bake it with declining energy sources and you have a disastrous recipe. Let us promote an alternative system. -- barbara

Molly Radke

Excellent post, as usual....tho this chile doesn't see coal as much of an even temporary "solution" to the "energy problem." Sure, you'd get the additional coal based energy, but at the cost of intensifying global climate change, which is ALREADY wreaking havoc in many areas. From what I read elsewhere, the blind powers that be in this strange land are even now ramping up coal-based energy production. Alas for our kids and grandkids. Of course you're "right," as in "correct" - there's just no way outa this conundrum.


So how, in practice, would the economy work if we accepted the fact of no more economic growth?

Would it, dare I say, have to be similar to the command economies that have been tried in the past - only this time without the perceived success of free market capitalism over the border provoking envy and unrest in the population?


One difficulty is that even a doctorate in physics wouldn't change much of anything. What you have to establish is not the silly tautology that growth to an infinite size is impossible. It's politically irrelevant, for example, that at current population growth rates, the Earth's entire surface will be covered by a seething mass of human flesh in seven or eight hundred years.

No, you have to establish that there is a serious constraint exerting itself, or that will do so within a time frame that people can grasp - i.e. 100 years out doesn't really count. The existence of such a constraint may be accepted in Peak Oil circles, but not in political circles. (And it's a bit risky to assert that no further technological progress will ever again be possible, an assertion that seems to be required to support some of the more doomish views in that community.) For that matter, I haven't even heard about any really serious constraint even from Steven Chu, who has more than two semesters of physics, although I certainly could have missed something.

George Mobus


An alternative system - yes. But what? Any thoughts?



Don't know if you've read any of John Michael Greer's stuff but he differentiates between 'problems', which can be solved, and 'predicaments', which cannot be solved, only bad consequences minimized (potentially). I concur with this characterization (in other circles predicaments are known as 'Wicked problems'). Our human condition is just such a case. We are in an unsolvable predicament and the sooner we recognize this and start looking for ways to minimize the bad consequences the better.

Of course one other characteristic of taking action in the case of predicaments is that of unintended consequences, or creating other predicaments as a result of those actions. You might lessen the pain in one domain only to increase it in another. I push the systems approach because I think it can help ferret out those potential consequences as you work through what actions might be taken. This is effectively what would be the ideal case in policy design, but, of course is almost never practiced.



I've actually written quite a lot about this question. You might be interested in some of those ideas. They can be found under the topics of "Sapient Governance" and "The Implications of a Sapient Governance" here:



OTOH, aside from Secretary Chu, there have been a wide number of books by other experts (with more than two semesters of physics) that do or have pointed out the constraints.

Here is a very partial (and not up-to-date) bibliography that you might use to see this:



Help me work through this thought exercise:

Property is a tacit agreement amongst people that only one person has the right to use a specific area of land.

Money is in some way related to (and maybe more correctly should be directly related to) the use of energy, so that money flows in the opposite direction of energy... someone hands money over for oil, which has embedded energy.

If "debt" is really borrowing originally off of existing surpluses (the grain silo example)... then for whatever energy we're using now it already exists, and all "debt" is really the use of more energy than we actually need at this current moment to survive.

So if you think of "debt" not in the terms we usually think of it, but instead think of it as the use of currently surplus embedded energy (that really is just already existing on the planet as transformed sunlight)...

And then if you think therefore similar to property as being tacitly agreed upon left-alone land...

Then what "debt" really is, is actually existing surplus embedded energy already existing on the planet that a select group of people are using for their own desires while everyone else on the planet tacitly agrees that those people somehow have a right to that energy.

...because supposedly at some point in the future that select group of people will have lots of energy to bestow back upon the people who are voluntarily waiting for their chance at the energy trough.

And they're hoping that as they "develop," through increased esteem of the people currently allowed to use the excess embedded energy, that one day they too will be allowed to use some of the excess embedded energy.

And the reason everyone sticks to this tacit agreement that those specific people are allowed to use that land and use that energy, is because we still have these ideas in our heads that certain people are endowed with certain rights over other people... the same way people used to believe one race was better than another race.

So the only reason we don't have planet-wide revolution is because some people still believe that because of whom someone's parents were, that person is likewise entitled to use of excess energy that someone else wasn't because of who their parents were.

Well, there's that, and the energy embedded in the bullets that would be shot at those without as much energy, thereby keeping them in line, or rather out of line for feeding at the energy trough.

So, one way or another, because there is a finite amount of energy available on this planet and it is already spoken for by a minority, the approaching collapse will be a great equalizer.

The competition for energy will heat up as collapse gets closer, but at some point the EROEI of even these energy wars will eventually dissipate. There will be no energy left to fight each other over the energy that they no longer have the energy to extract.

How crazy does all this abstraction sound?

George Mobus


Crazy! Or maybe not.

I would like to suggest an alternative view of debt though. I recognize two kinds of true debt (and a third kind of pseudo-debt that is derived from these two). Probably the earliest kind was as you describe, borrowing from reserves to fund some current enterprise, as when a new farmer borrows grain (seed) from the granary to start a new farm. The granary contains an excess of grain needed for the current season because it is a form of insurance against future bad crop years.

Anyone who has borrowed against their life insurance policy goes into this kind of debt. Should they die, their beneficiaries get less payout.

The other kind is when we borrow against the future in the sense that we use not just insurance but also current needed wealth (e.g. our food grain) to fund an enterprise that we believe will pay back soon enough to cover the borrowed wealth and more, the profit.

The first kind is betting that you won't have a bad season (or die) before the payoff. The second is betting that your payoff will come soon enough that nobody will be short changed in the current period. This is embodied in fractional reserve banking, for instance.

There is, of course, a third kind that isn't really debt at all, but rather a bet on the above bets. It requires money that represents a claim on assets to work. We can, these days, through the so-called financial system, bet that debt-based bets will (or won't) pay off. These are the so-called derivatives. This kind of gamble has worked reasonably well as long as energy flow was growing because the greater energy flow meant more work would be accomplished in the future and the debts would come to be paid, unless one were completely foolish and failed at the enterprise.

Credit card debt strikes me as being of this latter type, especially if you have little or no savings. You are betting that you will have a job tomorrow. Under current circumstances, probably not a good bet.

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