Republicans shoot down tax on rich

Sounds like we're in a Laffer curve debate again. Which is funny because people stopped using the Laffer curve argument the last time we started actually discussing the Laffer curve.

I don't think it's a Laffer Curve argument. More a Malthusian one.

Peter, I'm out of time at the moment, I'll get back to you.
 
long-term growth is unrealistic, and a physical impossibility.

If the US economy were to grow a 2-3% per year, we'd see a factor of 10 increase in 100 years.
[source: http://physics.ucsd.edu/do-the-math/2011/07/galactic-scale-energy/]

Where's all that stuff going to come from?

10x the energy
10x the raw materials
10x the people (??)
10x the waste (?)

Constant growth is a model for catastrophe. A hard reset. Transition to a steady state economy is the only (as far as I understand) viable long-term economic model.
If you'd'a told someone in 1800 that US per-capita income today would be $50,000 and the world population would have passed 7 billion, you would have been called crazy too. But it happened.

In 1820 US (real) GDP per capita was like $1,200. Now Google tells me that 50,000/1,200 = a factor of around 40. That's a ton of growth in 190 years. I'm just saying, massive amounts of real increase in living standards / income / output have happened in the past 200 years So it's not in principle impossible!
 
In 1820 US (real) GDP per capita was like $1,200. Now Google tells me that 50,000/1,200 = a factor of around 40. That's a ton of growth in 190 years. I'm just saying, massive amounts of real increase in living standards / income / output have happened in the past 200 years So it's not in principle impossible!

Look over all of human history, and you will find the last 200 years to be a significant outlier in terms of economic growth and change in the standard of living. Why assume this exception will continue indefinitely?

Furthermore, there is a fundamental limit to how many resources exist on Earth, by way of it being a finite place with finite resources. Thus, there must be some limit to the level of resource exploitation that is possible.
 
So are you claiming that economic growth can continue forever?



Economists generally have no belief in the Malthusian Trap for societies that are developed and have a lot of innovation. And I have to agree to that outlook.



I'm getting most of my impressions on all of this stuff from the DoTheMath blog.

Specifically, his post on Galactic Scale Energy:


I suggest you read the entire post, and the one linked at the end of his article. This is what forms my opinion that sustained economic growth is a long-term impossibility.


OK, I just took the time to read it. And, quite frankly, it's not an original point of view. Recently I had a conversation with someone by PM and he linked me THIS ARTICLE. Which is the same argument from a different perspective: Energy constraints as growth constraints. So I'm going to borrow from that response to respond to you.

One thought that comes to mind is that, yes we are energy dependent. But Japan produces a unit of GDP with half the energy inputs as the US. And the US produces a unit of GDP with half the energy inputs now than it did 35 years ago. Energy and raw materials inputs are not absolute constraints because we can innovate to use them more efficiently. It sounds like your authors are arguing for a Malthusian trap. And generally economists don't debate that much, because one of the core assumptions of economics (outside Marxism) is that it is not a legitimate subject for study. It is considered a settled debate. And Malthus looses. Much of modern economics has at its core, "Why is Marx wrong", "Why is Malthus wrong", not "are Marx and/or Malthus wrong". Do you see the distinction?

What exists to stop innovation? I can't think of a thing.


http://scienceblogs.com/tomorrowstable/2011/05/proving_malthus_wrong_sustaina.php

http://econc10.bu.edu/economic_systems/Theory/Classical/why_was_malthus__wrong.htm

http://people.uleth.ca/~kent.peacock/Why Malthus Was Wrong 2004.pdf

http://www.economist.com/node/11374623

If you have access to Discover Magazine, I recently was looking at the April 2012 issue. And there are a couple of articles that may help you see this world view. One of them makes the comment that as the world's population grows, more of the world's population lives in cities. And as the population of a city doubles, patents issued to people in the city increase 15%. The article is titled "Age of Abundance".

I guess I'm being a bit disjointed here. So let me sum up a bit.

As we develop past a certain point, the energy input per unit of GDP output is falling. We have access to more and more energy. At the same time, the population of the world is approaching the leveling off point. Without more people, the demands for most resources does not rise at the same rate. With the end of population growth, we can have higher standards of living without increases in resources in the same way. We each only eat so much, even if developed world people do eat more than undeveloped world people. We do only have so much material goods, even if developed world people do have more than undeveloped world people. More and more of our development is in intangibles rather than tangibles that need scarce resources. And resources have both ever greater efficiency of extraction and recycling, and ever better substitutes for those things that are in short supply.

So as my background is economics, I do not see resource constraints as crippling. You have to make an argument for why innovation would stop. Innovation has taken us from less than 1 billion people dirt poor, to 7 billion people, 5/7th of which are between much richer and unimaginatively richer than anything which ever existed in the past. Why would that stop? I don't see a reason.
 
Look over all of human history, and you will find the last 200 years to be a significant outlier in terms of economic growth and change in the standard of living. Why assume this exception will continue indefinitely?

Furthermore, there is a fundamental limit to how many resources exist on Earth, by way of it being a finite place with finite resources. Thus, there must be some limit to the level of resource exploitation that is possible.



See my answer to Peter as to why I do not see resource constraints as binding on economic growth.

But the thing you have to question is this: This phenomenal improvement in resource use over the past 200 years has been driven by innovation, and was completely unforeseeable in advance. In order to make the argument that the improvements will stop, you have to argue that the innovations will stop. And what basis do you have for making that claim?
 
long-term growth is unrealistic, and a physical impossibility.

If the US economy were to grow a 2-3% per year, we'd see a factor of 10 increase in 100 years.
[source: http://physics.ucsd.edu/do-the-math/2011/07/galactic-scale-energy/]

Where's all that stuff going to come from?

10x the energy
10x the raw materials
10x the people (??)
10x the waste (?)

Constant growth is a model for catastrophe. A hard reset. Transition to a steady state economy is the only (as far as I understand) viable long-term economic model.

Hence the last line of the of my post. But you don't need 10 times the people, and you won't make 10 times the waste. Raw material needs would necessitate better and better recylcing technology. As for the energy, 10x is doable. But overall, it's definitely a doomed system. Best case scenario we use up all the energy in the universe. Worst case scenario we have mass neo-malthusian starvation in 30 years and agree the only way forward is in extreme austerity.

@ Integral, of course it's not impossible , but the degree of capitalism's reach in the 1800s was still much smaller. Most of the world was touched but not a part of the capitalist/growth system. Much of capitalism's expansion, and therefore economic growth, came from untapped, uncapitalist sources. New labor markets, raw resources, etc. Now it's nearing asymptotic levels, and we will see what the next big move is. Profitability has been declining, which the capitalist world has seen 3 times before, before a huge burst. But each time was before the world was as tapped as now.

Now, the rate of innovation has been largely keeping pace with what we need to keep going, but there's some looming problems that innovation hasn't begun to seriously address and there's no magic reason why we can't be detrimentally blunted by our environment.
 
See my answer to Peter as to why I do not see resource constraints as binding on economic growth.

But the thing you have to question is this: This phenomenal improvement in resource use over the past 200 years has been driven by innovation, and was completely unforeseeable in advance. In order to make the argument that the improvements will stop, you have to argue that the innovations will stop. And what basis do you have for making that claim?

Innovation has allowed us to exploit the resources we have more efficiently, but it does not mean resources themselves are infinite. They are finite, just as before.

For example, in copper mining, back in the good ol' days (the Classical Era) it was estimated the copper ore extracted contained roughly 6% by weight copper. Nowadays, 1% is considered a great find, and most copper is extracted from ore that is around 0.5% to 0.7% copper. Same thing with most other long-extracted resources. We continue to get more efficient with our usage of the dwindling supply, but we are also faced with the fact the supply is diminishing. Eventually, we will need strong recycling systems--in layman's terms, the % of valuable metals in trash heaps will be greater than in fresh mines, so it will make the most sense to mine the garbage.

You'll notice I'm not putting down a prediction as to when we will be resource-constrained or suggesting the end of innovation, simply pointing out the obvious hard limits that do exist. The ultimate limit is that of energy: we are limited by thermodynamic efficiencies of energy conversion from the total solar incidence on Earth. Once we hit that, Earth can't provide us any more.
 
Innovation has allowed us to exploit the resources we have more efficiently, but it does not mean resources themselves are infinite. They are finite, just as before.

For example, in copper mining, back in the good ol' days (the Classical Era) it was estimated the copper ore extracted contained roughly 6% by weight copper. Nowadays, 1% is considered a great find, and most copper is extracted from ore that is around 0.5% to 0.7% copper. Same thing with most other long-extracted resources. We continue to get more efficient with our usage of the dwindling supply, but we are also faced with the fact the supply is diminishing. Eventually, we will need strong recycling systems--in layman's terms, the % of valuable metals in trash heaps will be greater than in fresh mines, so it will make the most sense to mine the garbage.

You'll notice I'm not putting down a prediction as to when we will be resource-constrained or suggesting the end of innovation, simply pointing out the obvious hard limits that do exist. The ultimate limit is that of energy: we are limited by thermodynamic efficiencies of energy conversion from the total solar incidence on Earth. Once we hit that, Earth can't provide us any more.


The thing is though that it is not a one to one relationship between rising standard of living and rising resource use. They can diverge through innovation. Yes, the easy to extract resources are already extracted, but note that the costs over the long term of extracting them are not going up. We use energy wastefully in the US. But Japan uses far less per unit of GDP. And the amount we use per unit of GDP is declining sharply over time. But consider that the cost of that energy has actually never been lower.

We are wasteful because it is just so very cheap.

It is cheap because we are that much better at producing and using it. Japan uses energy more efficiently because it is more expensive there. Same with Europe. The tech exists. And it is only getting better. When energy becomes more expensive in the US, we will use it more efficiently as well. We already do, but there's lots of room for improvement. Many other resources can be used more efficiently as well. We throw away just so very much because it's cheaper and easier than recycling.

Further, improved living standards are not all about simply more material possessions. There is a lot of that, but there are limits as well. The average person can have quite a nice life with one stove and one refrigerator, they don't need 3 of each.

Assuming we will reach the end of Earth's ability to support us also assumes that Earth's population will not level off. And the quicker we develop, the quicker it will level off. So that is a major lessening of pressure on resources right there.
 
I'm assuming that by population "leveling off" you mean we will follow the typical historical pattern which involves seasawing violently over the limit and under. =p

Maybe we'll sort it out better in the future a la Star Trek. In spite of all our current flaws we still do seem to do it better today than we did in the past.
 
@Cutlass:

Thanks for the links.

I'll summarize, so you can see if I've missed the key points in each.

1. Thomspon's article (scienceblogs) assumes that we'll be able to research and tech our way to feeding +50% more people using -30% water, producing +100% more food with next to no new land. Malthus was wrong because he underestimated our capacity for innovation.

2. Regarding the Castillo piece, I wonder if he proof-read it:
Malthus describes an unsustainable system in which population always grows faster than subsistence levels on earth. All penises are really really fat. And they are equal each other would be to adopt what he called, "preventive checks".
:lol:

His argument can be summarized as "Energy & Food are not a constraints on economic growth, we'll innovate." Malthus is wrong because he underestimated our capacity for innovation.

3. Kent Peacock's thesis is that humans will have to arrive at a mutualistic relationship with the rest of earth's biosphere. Malthus was wrong because his premise is based on a moralistic yearning.

4. The Economist notes that Malthus was writing at the cusp of two changing worlds - he based his conclusions on the agrarian model of production but that was on the way out, supplanted by the Industrial Revolution. And "even if oil wells were to run dry, economies can still adapt by finding and exploiting other energy sources." We'll be able to innovate our way to continued growth.


Here I'll summarize [for the casual readers :)] the article you linked: Energetic Limits to Economic Growth
Financial and energy economists have used econometric techniques to analyze time series of energy consumption and economic growth within countries in an effort to assess causal relationships, but they have reached no clear consensus about whether energy use causes economic growth, or vice versa

We infer that energy limits economic activity through direct causal mechanisms. The evidence for this inference is presented above and comes from three sources: (1) theory, the application of the second law of thermodynamics to complex adaptive systems; (2) data, the robust relationship between per capita energy use and per capita GDP across both space (the 220 nations of the world) and time (24 years); and (3) analogy, the similarity between biological and socioeconomic metabolism.

Just as higher metabolic rates are required to sustain and grow larger, more complex bodies (Kleiber 1961, McMahon and Bonner 1983), so higher rates of energy consumption are required to sustain and grow larger, more developed economies that provide greater levels of technological development and higher standards of living.

it has not been possible to increase socially desirable goods and services substantially without concomitantly increasing the consumption of energy and other natural resources

Even maintaining this increased population [9B] at the more modest Chinese standard of living would require 2.5 times more energy than is used today

Mainstream economists historically have dismissed warnings that resource shortages might permanently limit economic growth -- there is no scientific support for this proposition; it is either an article of faith or based on statistically flawed extrapolations of historical trends.

Some ecological economists and systems ecologists have made similar theoretical arguments for energetic constraints on economic systems. However, these perspectives have not been incorporated into mainstream economic theory, practice, or pedagogy

So here's how I see the current state of the discussion:
-I say that economic growth can't continue forever.
-It is pointed out that economic growth can continue for a lot longer assuming global population stabilizes.
-Energy limits on economic growth are compared to flawed Malthusian arguments
-Malthus is wrong because human will innovate (forever?)
-Therefore Energy is not a limit on economic growth, because we'll innovate
-But with innovation, the necessary increases in energy efficiency are enormous*

Cutlass said:
What exists to stop innovation? I can't think of a thing.
I'll answer you with more quotes (this post is already too long, I know :sad:)

Here's a line (taken from another DoTheMath post) from Limits To Growth (1974):
"We have felt it necessary to dwell so long on an analysis of technology here because we have found that technological optimism is the most common and the most dangerous reaction to our findings from the world model. Technology can relieve the symptoms of a problem without affecting the underlying causes. Faith in technology as the ultimate solution to all problems can thus divert our attention from the most fundamental problem—the problem of growth in a finite system—and prevent us from taking effective action to solve it."

Murphy's summation:
" if our faith [in technology] is so strong that we assume that’s where we are heading, based on extrapolation of our fossil-fueled joy-ride, then we don’t go all-out to avoid the real danger of a crash. Like the nerd in the school cafeteria, our mental state is so consumed by mathy/techno thoughts that we fail to notice the stupid stuff like the stool in our path"

*I'm not claiming that innovation will stop. However, your position, unless I'm misreading, is that economic growth will not be restricted by energy because innovation will continue to provide more GDP per unit energy.

So my question is how much more energy efficiency do you think is realistic?
 
So my question is how much more energy efficiency do you think is realistic?

When I was in school I had a car that weighed 4000 pounds and got crap gas mileage. My car now weighs 3000 and gets twice the mileage. There are numerous cars on the market now that weigh 2500 pounds and less that get near on twice the mileage I get. Hybrid gas-electric cars do even much better than that. Buses and trains better still. My 100 watt light bulbs are replaces with 23 watt compact florescents. My windows and doors have been replaced by new ones that cut the gas bill in half.

And, quite frankly, I'm barely trying.

You want to see what energy efficiency is possible, watch Japan over the coming decade. With their nuclear plants down, they have no choice. They will cut their energy per GDP quite a bit, and it's already half what the US uses.

What has to be born in mind is that we take the most energy usage path not because it is the only path, but because it is so cheap that it is the easiest path.

But in economics we have the concept of substitutes. In effect, whenever the price of something gets too high, people substitute something else for it. We substitute for energy by using tools and machines that use it more efficiently, and organizing our lives and our industry in ways that require less of it.

Energy consumption to our economy is not the same as food consumption to biology. We are not hard wired in to a specific ratio. We can change that ratio by changing how we behave. The current manner in which Americans choose to live may be unsustainable, but much of that is our choice to be wasteful. We could still live as a rich society with far greater energy efficiency. It would require giving up some things, but not prosperity as a whole.

I don't see an end to that.

There is an organized political lobby to keep America high energy dependent. Where does that come from? The people who sell energy. And that reduces the rate of innovation.

I see economics this way: Just because we can do something, doesn't mean we will. Just because we don't do something, doesn't mean we can't. There are choices to be made. We might make the wrong ones, and if we do the disruptions could be severe. But that's not the same thing as saying we are inevitably doomed.
 
I see economics this way: Just because we can do something, doesn't mean we will. Just because we don't do something, doesn't mean we can't. There are choices to be made. We might make the wrong ones, and if we do the disruptions could be severe. But that's not the same thing as saying we are inevitably doomed.

I completely agree with this. It's along the lines that I've been writing above - but the corollary is the one I'm worried about. I'm worried about us (the US, the Developed Nations, The World) not changing our habits fast enough.

Those efficiencies that you cited are all the low-hanging fruit. That doesn't mean we shouldn't pursue more of them, but I don't think it's realistic to assume that we can efficiency our way out of the energy limit. It's a hard wall that we'll come up against.

Regarding the substitutes (I didn't read the entire wiki, so sprinkle my comments with salt) we have 2 classes of 'alternative' energy. Non-traditional fossil fuels & everything else. The everything else includes fusion, fission, geothermal, solar, wind and, for the sake of argument, I'll include an unknown called ?

We have 2 classes of energy needs - liquid fuels (primarily used in transportation) and everything else. The everything else includes home heating & cooling, industrial agriculture production, manufacturing, home electricity, commercial electricity, and so on.

There is no currently scalable substitute available for transportation. Either our transportation system has to change to a completely different energy basis, or it's going to become more expensive to move stuff around, or we're going to have to change our expectations and behavior. Transportation is a significant chunk of GDP, and there's not too much left for efficiency gains under the current conditions.

With the 'Everything Else' class of energy use, we are in better shape. But not by much. All of the substitutes have significant downsides that - as I'm sure you're aware - work as incentives to keep us on Coal. If the costs of the bad stuff about coal were factored into the price of electricity I'm sure nuclear would become a lot more attractive (I'm actually a big fan of nuclear, but that's another topic). Solar has enough scalability that it can surpass all our energy needs for several doublings of our GDP, but the biggest downside is storage and distribution. Can't bottle the sun.

All of this stuff is discussed at length on DoTheMath. I'd love to start a thread just to talk about the issues he raises. But instead I'll refer you to his post on Efficiency:
The important result is that trying to maintain a growth economy in a world of tapering raw energy growth (perhaps accompanied by leveling population) and diminishing gains from efficiency improvements would require the “other” category [non-physical] of activity to eventually dominate the economy. This would mean that an increasingly small fraction of economic activity would depend heavily on energy, so that food production, manufacturing, transportation, etc. would be relegated to economic insignificance. Activities like selling and buying existing houses, financial transactions, innovations (including new ways to move money around), fashion, and psychotherapy will be effectively all that’s left. Consequently, the price of food, energy, and manufacturing would drop to negligible levels relative to the fluffy stuff. And is this realistic—that a vital resource at its physical limit gets arbitrarily cheap? Bizarre.

I guess what I'm after is a different question than you've been answering. You've been explaining why economists think growth can continue. If that's the case, then Tom Murphy is wrong. If he's wrong, I'm not seeing it. And that's a sobering thought.

PS - he also has a little fanciful recap of a conversation he had with an economist. You may find that more (or less :lol) pertinent:
http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-physicist/
 
I completely agree with this. It's along the lines that I've been writing above - but the corollary is the one I'm worried about. I'm worried about us (the US, the Developed Nations, The World) not changing our habits fast enough.

Those efficiencies that you cited are all the low-hanging fruit. That doesn't mean we shouldn't pursue more of them, but I don't think it's realistic to assume that we can efficiency our way out of the energy limit. It's a hard wall that we'll come up against.

Regarding the substitutes (I didn't read the entire wiki, so sprinkle my comments with salt) we have 2 classes of 'alternative' energy. Non-traditional fossil fuels & everything else. The everything else includes fusion, fission, geothermal, solar, wind and, for the sake of argument, I'll include an unknown called ?

We have 2 classes of energy needs - liquid fuels (primarily used in transportation) and everything else. The everything else includes home heating & cooling, industrial agriculture production, manufacturing, home electricity, commercial electricity, and so on.


I think you overstate our long term dependence on liquid fuels. The only mode of transport, in the longer term, not the short, that is dependent on liquid fuels is air travel. It would take some decades to change the other modes of transport over to electricity, but it is doable. Even with today's tech, much less tomorrow's.



There is no currently scalable substitute available for transportation. Either our transportation system has to change to a completely different energy basis, or it's going to become more expensive to move stuff around, or we're going to have to change our expectations and behavior. Transportation is a significant chunk of GDP, and there's not too much left for efficiency gains under the current conditions.


But a lot of transportation is really optional. We can, simply put, use less of it. And in many cases we do. More of the world's population lives in cities. Cities have lower transportation needs.



With the 'Everything Else' class of energy use, we are in better shape. But not by much. All of the substitutes have significant downsides that - as I'm sure you're aware - work as incentives to keep us on Coal. If the costs of the bad stuff about coal were factored into the price of electricity I'm sure nuclear would become a lot more attractive (I'm actually a big fan of nuclear, but that's another topic). Solar has enough scalability that it can surpass all our energy needs for several doublings of our GDP, but the biggest downside is storage and distribution. Can't bottle the sun.

All of this stuff is discussed at length on DoTheMath. I'd love to start a thread just to talk about the issues he raises. But instead I'll refer you to his post on Efficiency:


I guess what I'm after is a different question than you've been answering. You've been explaining why economists think growth can continue. If that's the case, then Tom Murphy is wrong. If he's wrong, I'm not seeing it. And that's a sobering thought.

PS - he also has a little fanciful recap of a conversation he had with an economist. You may find that more (or less :lol) pertinent:
http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-physicist/



I think he's working from assumptions that do not necessarily hold true. First, the "exponential growth", as it has been running is not just per capita GDP growth, but in fact applying that growth to an every larger number of people as well. And that is going to end. No question, that is going to end. When people become prosperous, population growth falls to, and below, replacement levels. So we are actually doing the long term resource trends a favor the faster we lift people out of poverty. (Which ties back to why the thread exists and the Republicans are fundamentally wrong.) Once the population growth halts, per capita GDP growth can continue with far less stress on resources. Your physicist was assuming both exponential growth and trend population growth. That misses a key current trend.

From your conversation link.



I also think you cannot discount the importance of that last portion of the graph where the energy use curves strongly away from the previous trend line. hat divergence tells you a lot. One of the things it tells you is that we use energy and other resources more efficiently. But another thing it tells you is that there are limits to the increased per capita resources that are used in other respects as well. Food, for example. An American's calorie intake may be far higher than that of someone in a poor country, but above a certain point people just can't take in any more food. There is a saturation point, and most people in developed nations are at it. I can't buy 3% more food every year for the rest of my life unless I'm just going to throw it away.


Here I have a couple of excerpts from your conversation link.


Physicist: Before we tackle that, we’re too close to an astounding point for me to leave it unspoken. At that 2.3% growth rate, we would be using energy at a rate corresponding to the total solar input striking Earth in a little over 400 years. We would consume something comparable to the entire sun in 1400 years from now. By 2500 years, we would use energy at the rate of the entire Milky Way galaxy—100 billion stars! I think you can see the absurdity of continued energy growth. 2500 years is not that long, from a historical perspective. We know what we were doing 2500 years ago. I think I know what we’re not going to be doing 2500 years hence.


See, here I think he's just going off the deep end. As I say, that would require not just per capita economic growth, but endless population growth, and endless mass of each individual person growth.

I just think he's not looking at the whole picture.


Physicist: But let’s leave the Matrix, and cut to the chase. Let’s imagine a world of steady population and steady energy use. I think we’ve both agreed on these physically-imposed parameters. If the flow of energy is fixed, but we posit continued economic growth, then GDP continues to grow while energy remains at a fixed scale. This means that energy—a physically-constrained resource, mind—must become arbitrarily cheap as GDP continues to grow and leave energy in the dust.

Economist: Yes, I think energy plays a diminishing role in the economy and becomes too cheap to worry about.

Physicist: Wow. Do you really believe that? A physically limited resource (read scarcity) that is fundamental to every economic activity becomes arbitrarily cheap? [turns attention to food on the plate, somewhat stunned]

Economist: [after pause to consider] Yes, I do believe that.

As I said above, real energy costs over the past couple of centuries has been declining, not increasing. That kind of show's the economists point.

Generally I don't think that my argument has been all that different from the economist's argument. Though the physicist, as presented, was pretty influential in respect to that economist.
 
The thing is though that it is not a one to one relationship between rising standard of living and rising resource use. They can diverge through innovation. Yes, the easy to extract resources are already extracted, but note that the costs over the long term of extracting them are not going up. We use energy wastefully in the US. But Japan uses far less per unit of GDP. And the amount we use per unit of GDP is declining sharply over time. But consider that the cost of that energy has actually never been lower.

We are wasteful because it is just so very cheap.

It is cheap because we are that much better at producing and using it. Japan uses energy more efficiently because it is more expensive there. Same with Europe. The tech exists. And it is only getting better. When energy becomes more expensive in the US, we will use it more efficiently as well. We already do, but there's lots of room for improvement. Many other resources can be used more efficiently as well. We throw away just so very much because it's cheaper and easier than recycling.

Good grief, there are a ton of assertions here that are not universally true. The costs of extraction are situational based on each industry. Energy itself doesn't decrease in price every year since the Stone Age, methinks (more on this later). Carbon emissions correlate well-enough with the increase in living standards, and even if a country is efficient with its fuels and has low emissions they still produce more carbon than a medieval society. Not to mention you are ignoring subsidies and a whole host of other economic factors on industrial production, but let's leave those for another thread.

Further, improved living standards are not all about simply more material possessions. There is a lot of that, but there are limits as well. The average person can have quite a nice life with one stove and one refrigerator, they don't need 3 of each.

While I agree, that's not how living standards are measured and isn't really a point of contention in this debate.

Assuming we will reach the end of Earth's ability to support us also assumes that Earth's population will not level off. And the quicker we develop, the quicker it will level off. So that is a major lessening of pressure on resources right there.

I think you are skipping a few steps here. Do people [in third world countries] have more or less unprotected sex when inventors are successful?



I'll let PG take care of most of the conversation link--I definitely enjoyed it. But this is the quote that really annoyed me:
I just think he's not looking at the whole picture.

That's right, it's yours. That graph cuts off at 1650. The key point being made here, irrelevant of the nitty-gritty details, is you can't make an extrapolation based on a fraction of the data and expect it to continue indefinitely without bound. Why don't you extend that graph back to 10,000 BCE? Or 100,000 BCE? Once you do that, the last few centuries of exponential growth looks like the end divergence on the 1650 graph above.
 
Cutlass said:
See, here I think he's just going off the deep end. As I say, that would require not just per capita economic growth, but endless population growth, and endless mass of each individual person growth.

I just think he's not looking at the whole picture.

See, according to my reading, you keep missing the most salient point. Yes, population growth will be bounded by physical constraints (at what level, though?), and Yes, people can only consume so much food... but different foods require more or less energy to produce, process, distribute, and dispose of.

Let's look at a couple of extreme examples from the meal that my wife and I had tonight:
She had the skirt steak, I had the poblano quesadilla. Both meals were close to the same mass. But her meal took far more solar energy to produce than mine. First there's the grass and corn that was fed to the cow. Then there's the fertilizer that's petroleum based used to augment the growth of the grass (and some for the cow, too). My meal didn't require those additional energy expenditures. So right here we have a salient example of 2 ways to provide a meal - one is more energy intensive than the other. Obviously you can increase your energy intake regarding food year by year as your purchasing power increases. In fact that's one of the major concerns with Climate Change - third world nations developing first world meat consumption patters results in quite a jump in CO2 production.

But that only deals with the food aspect. The main point - and the one I think you're missing (or I'm mistakenly claiming your missing it) is that economic growth MUST be limited by energy. When I brought this up before the response was that this was a Malthusian argument, and Malthus was wrong because we'll always - (always = ad infinitum!) - be able to innovate. But the logical consequence of perpetual innovation is that the forces that govern the Universe are infinite. I know, that's crazy! But look:

-Industrial Revolution represented an exponential growth in the economies that came before it by understanding and manipulating Electro-Magnetic forces

-Nuclear Power (the only real 'post-industrial revolution) happened because we discovered how to control the Strong (fusion + fission) and Weak (appropriately named) Nuclear forces

What's left? Gravity. And ? Remember ?? Me neither - I brought it up as a place holder for fanciful future-tech. But fanciful future-tech is not the sort of thing you want to gamble a multi-trillion dollar economy on. But if you assume that we'll always be able to innovate, and if you notice that we've already run through 3 of the 4 fundamental forces the Universe has to offer us, then you're making the implicit claim that within 30-100 years Science will be able to deliver a whole new fundamental force as a basis for energy growth, so our perpetual growth model can continue. But bear in mind they've been working on Fusion for 30 years so far, and the running joke is that it's always 10 years away. I'm not saying it's not going to happen, but clearly it can't be counted on as a substitution. And obviously economics isn't going to determine what physics exists. Physics is going to determine what space constrains economics. And in this case is just comes back to energy. Every time.

Speaking of substitutions, you are correct that the current state of technology *could* substitute liquid fuels, but not without tremendous upheaval, disruption, and resistance. I completely agree that we could do what's necessary. But we're not. And I simply don't see us moving in that direction. The incentives aren't there, and the political will needed is being undermined by corporate influence. I'm preaching to the choir here, but it's still worth saying.

But the energy thing is really important. I think you're giving too much credit to our ability to conserve and efficiency our way out of this trap. You say he's not looking at the big picture, but I think you're wrong. He IS looking at the big picture. That picture is 7-9 billion people all aspiring to use as much energy as Japan. Where's that all going to come from? And where's all that waste heat going to go?

And I haven't even mentioned the Energy Trap, which is another clash of physics & economics!
 
Good grief, there are a ton of assertions here that are not universally true. The costs of extraction are situational based on each industry. Energy itself doesn't decrease in price every year since the Stone Age, methinks (more on this later). Carbon emissions correlate well-enough with the increase in living standards, and even if a country is efficient with its fuels and has low emissions they still produce more carbon than a medieval society. Not to mention you are ignoring subsidies and a whole host of other economic factors on industrial production, but let's leave those for another thread.


Sure, it's complicated, and this is a silly little internet discussion.



While I agree, that's not how living standards are measured and isn't really a point of contention in this debate.


Maybe it should be. There are aspects of wealth that cannot be grown for every person on the planet. Not everyone can have multiple homes, no matter what economic growth happens. Neither can the average size of homes increase forever. There are physical constraints there. There isn't enough Florida beachfront for 7 billion people. But within broad limits that doesn't mean that people cannot have ever rising standards of living. If not more of things, then better quality of things.



I think you are skipping a few steps here. Do people [in third world countries] have more or less unprotected sex when inventors are successful?



Birthrates dropping with development is recognized to happen in nearly all societies outside of the most oppressive Muslim nations.



I'll let PG take care of most of the conversation link--I definitely enjoyed it. But this is the quote that really annoyed me:


That's right, it's yours. That graph cuts off at 1650. The key point being made here, irrelevant of the nitty-gritty details, is you can't make an extrapolation based on a fraction of the data and expect it to continue indefinitely without bound. Why don't you extend that graph back to 10,000 BCE? Or 100,000 BCE? Once you do that, the last few centuries of exponential growth looks like the end divergence on the 1650 graph above.


Had you read Peter's links, you would see that the change in the trend line is something both sides of the debate agree is actually real. Trend lines do change. And when a trend is, for 50 straight years, substantially different from the previous trend, then you really need to ask yourself why that might be, and whether it in fact represents a sea change in the trends. Don't just dismiss it as an anomaly. Now you can make arguments about why it is not sustainable, but you cannot make the argument that the trend line has not in fact changed for the, at this point lengthy period of time, and foreseeable future.

The change is in fact the current trend. Your argument cannot be that we are going to automatically go back on the other line, but rather you have to make a case for why we cannot stay on the current trend.

World economic growth for the previous century, expressed in constant 1990 dollars. For the first half of the century, the economy tracked the 2.9% energy growth rate very well, but has since increased to a 5% growth rate, outstripping the energy growth rate.

http://physics.ucsd.edu/do-the-math/2011/07/can-economic-growth-last/




Applied science has changed the trend line once. Why can't it happen again?
 
See, according to my reading, you keep missing the most salient point. Yes, population growth will be bounded by physical constraints (at what level, though?), and Yes, people can only consume so much food... but different foods require more or less energy to produce, process, distribute, and dispose of.



First, I don't think that we need to worry about population growth bound by physical constraints. Birthrates naturally fall as nation's become more developed. Excessive population growth is only taking place where people remain, effectively, peasants.

Now this is a political choice, and one where we have largely not been making the right choices, which makes the problem worse off in the long run. But population growth will slow, will even reverse, naturally if we simply get more people out of poverty. In that sense more resource use now can be expected to lead to less resource use in the long run.



Let's look at a couple of extreme examples from the meal that my wife and I had tonight:
She had the skirt steak, I had the poblano quesadilla. Both meals were close to the same mass. But her meal took far more solar energy to produce than mine. First there's the grass and corn that was fed to the cow. Then there's the fertilizer that's petroleum based used to augment the growth of the grass (and some for the cow, too). My meal didn't require those additional energy expenditures. So right here we have a salient example of 2 ways to provide a meal - one is more energy intensive than the other. Obviously you can increase your energy intake regarding food year by year as your purchasing power increases. In fact that's one of the major concerns with Climate Change - third world nations developing first world meat consumption patters results in quite a jump in CO2 production.



This is a good point. And I am aware of it, even though I breezed past it earlier. Not only do we consumer more calories, but different ones, that are less sustainable.

However that is not a given for the future. and the fact that 9 billion people are not going to be able to eat steak 3 meals a day does not mean that 9 billion people cannot eat quite well 3 meals a day. The fact that some things will have to change is not the same thing as saying that we have to give up something good for something less good. Just something different.



But that only deals with the food aspect. The main point - and the one I think you're missing (or I'm mistakenly claiming your missing it) is that economic growth MUST be limited by energy. When I brought this up before the response was that this was a Malthusian argument, and Malthus was wrong because we'll always - (always = ad infinitum!) - be able to innovate. But the logical consequence of perpetual innovation is that the forces that govern the Universe are infinite. I know, that's crazy! But look:

-Industrial Revolution represented an exponential growth in the economies that came before it by understanding and manipulating Electro-Magnetic forces

-Nuclear Power (the only real 'post-industrial revolution) happened because we discovered how to control the Strong (fusion + fission) and Weak (appropriately named) Nuclear forces

What's left? Gravity. And ? Remember ?? Me neither - I brought it up as a place holder for fanciful future-tech. But fanciful future-tech is not the sort of thing you want to gamble a multi-trillion dollar economy on. But if you assume that we'll always be able to innovate, and if you notice that we've already run through 3 of the 4 fundamental forces the Universe has to offer us, then you're making the implicit claim that within 30-100 years Science will be able to deliver a whole new fundamental force as a basis for energy growth, so our perpetual growth model can continue. But bear in mind they've been working on Fusion for 30 years so far, and the running joke is that it's always 10 years away. I'm not saying it's not going to happen, but clearly it can't be counted on as a substitution. And obviously economics isn't going to determine what physics exists. Physics is going to determine what space constrains economics. And in this case is just comes back to energy. Every time.


I'm not sure what to respond to this. I mean, it is a strong and intuitive argument. But is it the right one? In a world where the population will eventually stop growing, and then will decline, do we really need ever more energy, above and beyond what can be gained through efficiency, in order to have improving lives and a growing economy?



Speaking of substitutions, you are correct that the current state of technology *could* substitute liquid fuels, but not without tremendous upheaval, disruption, and resistance. I completely agree that we could do what's necessary. But we're not. And I simply don't see us moving in that direction. The incentives aren't there, and the political will needed is being undermined by corporate influence. I'm preaching to the choir here, but it's still worth saying.


You overstate the disruption by underestimating the time frame that the substitutions will likely take place in. This isn't going to happen in 5 years. And in 50 years, all the current machinery will have to be replaced because of wear and tear in any case.



But the energy thing is really important. I think you're giving too much credit to our ability to conserve and efficiency our way out of this trap. You say he's not looking at the big picture, but I think you're wrong. He IS looking at the big picture. That picture is 7-9 billion people all aspiring to use as much energy as Japan. Where's that all going to come from? And where's all that waste heat going to go?

And I haven't even mentioned the Energy Trap, which is another clash of physics & economics!


Wind and solar produce extremely little waste heat. What they do is convert one form or energy already on Earth to another form. There is some efficiency loss as heat. But is not the same as producing energy from fossil fuels or nuclear. Now maybe your author is right. But I really don't see the constraints within the next couple of centuries.

I do think we should push harder for changes now than the current conservative consensus tells us to. That's a failure at the political level. But I don't see how we are doomed in the long run. Not in the next 200 years, at any rate.
 
Are you suggesting that the effective tax rate does not correlate at all with tax revenue?
No. I used the word "almost" in there.

Yeah. He followed Bush Sr. who had realised he needed to increase taxes.
Wrong. Clinton used corporate tax cuts (Bush Sr. increased taxes because Congress was holding the government's finances hostage--"No New Taxes" was the correct approach, but the Democrats were absolutely determined to make him break that pledge at any cost)

2008, 2009, 2010 are not the future. This chart was compiled in 2010. The chart is not 'bogus'.
Yes it is. Three years is not enough to produce anything statistically valid as a trend, and the other seven years on the chart HAVE NOT HAPPENED YET.

And there's a second problem with your chart. Its high-water mark is labelled "current deficit projection". The low-water mark, "deficit without these factors". That's more than bogus, it's a very common statistical form of lying. The "deficit without these factors" would also be zero if Medicare and Social Security didn't exist. Must mean Social Security and Medicare are causing the current deficits......right? Wrong.

It's only misleading in the sense that, given no change to the future, this is what's projected to happen. Obviously things will change.
Thank you. You just said the chart is only valid if things don't change. Then you said "things WILL change". Therefore the chart is bogus.

In this case, I think you should back up your claims that there's next to no correlation between tax cuts and deficits.
I have. Several times. a link straight to the U.S. government's own figures.
 
Top Bottom