abs@rdin.UUCP (Andrew Siegel) (08/20/84)
I'm amazed at some of the odd ideas that people have about economics. Specifically, I can't understand what attraction a no-growth economy would hold for anyone. Would anyone argue with the fact that almost any *constructive* human action creates wealth? Anytime that we convert an item into a more desirable item, we have added to the wealth of the universe. Examples: stacking wood; cutting very long pieces of wire into short ones; writing Lotus 1-2-3; sweeping a floor. In a way, then, we constantly create order from chaos. To have an economy with zero-growth, we must synchronize these constructive acts of order and creation with *destructive* acts of equal magnitude, i.e. for every floor swept, another one must be dirtied; for every new time-, energy-, and/or money-saving idea, an old one must be forgotten. Clearly, this is ridiculous. With this in mind, there are some fallacies that I wish to address: Fallacy 1: A growing GNP means a growing consumption of energy and raw materials. Response: This is not true. Energy and raw materials cost money. Producers want to minimize cost to themselves. Therefore, there is a tendency to minimize use of these resources. In fact, as technology improves, the energy and materials needed to perform a task (or to create an item) diminish. Example: which costs more to operate, an IBM 7090 or 16 IBM PC's? Which uses less energy for equivalent amounts of work? Which uses fewer raw materials to provide the same capability? Fallacy 2: In a no-growth economy, "those products that are least needed will no longer be produced", or efficiency will be improved by "flushing marginal products out of the market." (Quoted from an article by Kurt Guntheroth.) Response: This assumption indicates that some objective third party somehow knows which products are "least needed" or marginal. If a product is "least needed", but is still being produced, then isn't it obvious that SOMEONE needs it? After all, manufacturers don't produce merely for the pleasure of seeing their logo on a department store shelf; they produce for profit. If no one's buying the product, they'll eventually stop making it. (Unless, of course, the manufacturer is subsidized.) Anyway, we don't have to wait for a no-growth economy for these things to happen; the market takes care of these automatically. Fallacy 3: Isn't there some inherent limit as to how large the economy can grow? Response: Wouldn't it have been a tragedy if, after Aristotle said "Objects at rest remain at rest, and objects in motion come to rest", all scientists then and in the future decided that "we know everything there is to know", and stopped thinking? Can anyone say with conviction that we know everything there is to know? We will always learn new concepts and ideas, and we will always be able to apply some of these ideas in order to create more wealth. Let the GNP determine itself. Don't mess with it. Andrew Siegel philabs!rdin!abs (until 8/24)
faustus@ucbvax.UUCP (Wayne Christopher) (08/22/84)
> Fallacy 1: A growing GNP means a growing consumption of energy > and raw materials. This seems quite reasonable to me. More technology does mean more efficient use of energy, but I doubt that this can keep up with the rate of expansion of a reasonably healthy economy (say an increase of 5% / year). The example with the 7090 and the PC's cannot be applied to the economy as a whole -- certainly the computer industry is not representative of the rest. Of course, a growing GNP probably means that better ways of getting these raw materials and power are being developed, so we don't have to worry about huge coal-burning plants and strip mines being the result of economic growth. > Fallacy 3: Isn't there some inherent limit as to how large the > economy can grow? This is also reasonable, and I think that the limit must be tied to the amount of space that we have to expand into. However, if there is such a limit, we're certainly nowhere near it. The thing to worry about is that the closer we get, the worse the "quality of life" will become -- the world will take on the appearance of one huge factory, and its inhabitants, although quite wealthy by our standards, will live their lives sealed in huge living complexes. Now, this is a worst-case situation, but somthing is clear -- if we want the economy to continue to expand, we have to look for alternatives such as space-based industry. Although there seem to be no built-in limits to economic expansion, the environment and our own mental well-being will inevitably suffer unless we try to direct economic growth towards space. Wayne