Throughout my time in school, I've taken some interesting classes. I'm in one this semester called Envisioning Sustainable Economies that is just awesome because it's what this blog has been about since I started writing it ten years ago. Each week, we're given questions in an online discussion forum that deal with some of the most important elements of any economy and challenge us to offer solutions. Here is a just a small piece of what will be posted once the semester ends and I've answered all of those questions. For now, here is what I submitted as my term paper answering the question,
What is the Size and Growth Rate of a Sustainable Economy?
Perhaps
the first step in understanding the functional size and growth rate of a
sustainable economy in any meaningful way is to define the term. Interestingly,
the definition and etymology of the word economy
is typically ignored outright and discussions—whether in academic or social
settings—often devolve into competing streams of word salad that fail to
address any social or environmental problems in realistic ways. (For example,
an “invisible hand” apparently waves
away economic woes around the planet; but billions live in abject poverty
despite this bold, baseless proclamation.[1] Hand-wavy indeed!) So, what’s it all about?
The
modern English word economy stems
from the Greek oikonomia (οικονομία)[2],
which translates to “household management”. But, why is that important? Well,
in order to sustainably engineer any type of economy on the global scale of
human civilization, the planet itself must first be understood for what it is:
humankind’s household. As such, it must be intelligently managed. Of course, humans
developed the techniques and technologies capable of affecting planetary
processes only within the last two centuries or so; yet in that
cosmically-irrelevant amount of time, every single life system on Earth has
been driven to a stressed state of decline. Mass species extinction and
biodiversity loss[3];
dwindling freshwater supplies[4];
arable land degradation[5];
ocean acidification[6];
carbon cycle tampering[7];
accelerating energy source depletion (Ristinen, Kraushaar, and Brack 2016)—humankind’s
bootprint is immense and deep. But,
while the damage is, in fact, teetering on
the precipice of irrevocability,
a glimmer of hope perhaps shines through—the realization that if the economic
model in place on a given habitable planet fails to meet the needs of the all of the supposedly-intelligent
life that perpetuates it, suffering will in one way or another exist for at
least some of that life. Moreover, if that economic model also exceeds the
carrying capacity of the planet, a suffering environment joins the list of the
aggrieved. Both circumstances should certainly be avoided![8]
Great!—a
solid foundational context for an economy has been laid in the form of a
household (Earth) and its manager (humankind). It’s now the perfect time to ask
the question: Does the global economy currently in place on Earth meet the
needs of all humans and
operate within the carrying capacity of the planet?[9] The answer, disappointingly,
is no. Species fall like dominoes—succumbing
to the effects of anthropic forces the world over—while some people spend
hundreds of thousands of dollars for the chance to shoot an elephant, a
giraffe, or another “exotic” animal under the guise of conservation.[10]
(Steve Irwin absolutely disagreed with such a flippant use of the term![11])
Thousands of children die every day
from starvation and hunger-related diseases[12] in underdeveloped countries
while millions of tons of good food get thrown away every year in just the United States![13] Billions of tons of carbon
dioxide are dumped into the atmosphere yearly through the burning of fossil
fuels for energy while clean, renewable sources—solar, wind, wave, tidal,
geothermal—have been advancing for decades with minimal implementation
(Ristinen, Kraushaar, and Brack 2016). Clearly, there is a massive disconnect
between what’s possible and what’s actually put into practice. Proper household
management, this certainly is not! No
matter how much an economic model demands, infinite growth simply cannot occur
in a finite system (or on a finite planet such as Earth). So, the only sensible
approach, which avoids the ultimately unnecessary rehashing of streams of
critiques against market economics, is to set the entire framework of it aside
and start with the carrying capacity of an evolutionarily-adapted human-free
Earth.[14] And,
while the prospect of starting fresh here is (for obvious reasons) impractical,
the exercise of designing a sustainable economy from the ground up[15]
can give insight into what is
possible given the current state of affairs in technology, socioeconomic systems,
and resource distribution.[16]
The
first thing to address is the question of scale: How big is a sustainable
economy? In short, the scale of a sustainable economy must remain within the
carrying capacity of a given planet while avoiding putting unnecessary stresses
on the critical life systems dependent upon it. If, for example, the resources required
for comfortable, modern human life face depletion with a particular economic
model, then that model must be rejected. Any system that uses up
resources much faster than their regeneration rates will inevitably fail to
meet the needs of its constituents—rates of usage and waste production being
determining factors in the timeframe. Likewise, any system that requires as its
foundation the perpetuation of the dichotomistic ideas of scarcity (whether pretended or real) and infinite growth on a finite planet will inevitably fail to meet the
needs of its inhabitants. The benchmark for living within the carrying capacity
of the Earth is therefore determined by the planet itself—not by someone’s opinion. This means that, while growth is
certainly allowable, it must be strictly limited to what the environment can
handle. In the words of Industrial Designer and Social Engineer, Jacque Fresco,
“You can’t exceed your environment.”[17] It doesn’t really matter
what anyone thinks, believes, or speculates—nature has the final say in how
this business of life, the universe, and
everything[18]
pans out.
What
about the growth rate? Numerous growth models have been developed in the past
few centuries that have attempted to predict future development based upon a
multitude of factors. But, the most basic growth equation from differential
equations has the following form (Farlow et. al 2007):
(Eq. 1)
.
.
This model, developed by Thomas
Malthus in 1798, represents population growth or decay at exponential rates
based upon whether k (called the growth constant) is positive
(unrestricted growth) or negative (decay). Using separation of variables[19], this equation can be rearranged
and solved giving the solution (Farlow et. al 2007),
(Eq. 2)
where A is the initial population. Although this solution outputs a
wildly-overestimated population in just a few decades—Malthus used a growth
rate of 3% and a population of around 900-million—its derivation provided one
of the first examples of predicting human population in the future. Furthering
the exercise, replacing certain variables and including others (for example, variable growth rate) eventually gives a
version of the logistic equation of
Pierre Verhulst (1838), which takes into account the initial growth rate and the carrying
capacity (Farlow et. al 2007),
(Eq. 3)
In this model, r is the intrinsic growth
rate, y represents population,
and L is the carrying capacity. The solution to this equation with the initial
value of y(0) = y0 can be used to more accurately predict future
population and its theoretical maximum. Replacing the carrying capacity, L,
with the threshold level, T; making the intrinsic growth rate negative; and using the same initial value
mentioned above predicts a minimum population threshold, below which a species
will become extinct (Farlow et. al 2007):
(Eq. 4) 
.
.
If a system is to remain
sustainable, population growth rates must
be taken into account. In fact, the growth rate of a population and its minimum
threshold are perhaps two of the most important factors to consider (outside of
carrying capacity itself) when developing a sustainable economy. If there
aren’t enough resources to maintain a prosperous, healthy, growing population,
it will eventually result in territorial disputes, war, poverty, unnecessary
suffering, and countless deaths; if the population isn’t large enough to
maintain positive growth (for any number of reasons), then the species goes
extinct. But, what does this exercise say about the rate of population,
economic, or other possible growth that should
occur? Not much. That requires value judgements.
If an exponentially-increasing
population causes untold environmental degradation and human suffering, and falling below the minimum threshold
population spells disaster for the species, then the balance is struck
somewhere between the two extremes in a steady-state
economy. More specifically, the idea is to develop and implement an economy that varies appropriately with
dynamic equilibrium and accounts for social trends, seasonal weather, climate,
immigration patterns, and perhaps several other factors as they change through
time—that is, a sort of Goldilocks
Economy. The human species presumably would like to subsist with minimum
suffering; so, the conditions on the planet—both natural and economic—have to
be just right. And it appears that
large deviations from this mindset can and will lead to disastrous conditions
that tend to coexist—albeit in a somewhat detached manner—with affluence, as
evidenced by the fact that some pockets of society are currently dealing with
crop failures and starvation, freshwater shortages, and state-sponsored
propaganda, while other pockets destroy food to increase profits, take
45-minute showers, and argue about which politicians lied to them in the best,
most convincing way. Thus, the only viable option is to implement a global steady-state economic model that allows for dynamic equilibrium and raises the
standard of living for every human on Earth. Anything less will undoubtedly
continue the cycle of human and environmental suffering that has become all too
common and acceptable around the world.
References
Adams, D.
(2002). The Ultimate Hitchhiker’s Guide
to the Galaxy. New York: Del Rey.
Daly, H.
E., & Farley, J. (2011). Ecological
Economics: Principles and Applications.
Washington, D.C: Island Press.
Farlow,
J., Hall, J. E., McDill, J. M., & West, B. H. (2007). Differential Equations & Linear
Algebra. Upper Saddle River, NJ: Prentice Hall.
Joseph,
P. (2017). The New Human Rights Movement:
Reinventing the Economy to End
Oppression. Dallas, TX: BenBella Books.
Ristinen,
R. A., Kraushaar, J. J., & Brack, J. T. (2016). Energy and the Environment. Hoboken,
NJ: Wiley.
Smith, A.
(2009). The Wealth of Nations. Lexington, KY: Seven Treasures Publications.
Online Journals and Other Internet Sources
- https://www.dictionary.com/browse/economy
- https://e360.yale.edu/features/global_extinction_rates_why_do_estimates_vary_so_wildly
- http://www.un.org/waterforlifedecade/scarcity.shtml
- https://www.mdpi.com/2071-1050/8/3/281/htm
- https://esajournals.onlinelibrary.wiley.com/doi/full/10.1890/14-0802.1
- https://www.pnas.org/content/112/2/436?etoc=&utm_content=buffer47939&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
- https://www.thevenusproject.com/faq/what-is-a-resource-based-economy/
- http://www.hsi.org/issues/trophy_hunting/facts/facts-about-trophy-hunting.html
- https://www.youtube.com/watch?v=yZVPKbZ4cKg
- https://www.thp.org/knowledge-center/know-your-world-facts-about-hunger-poverty/
- https://www.usda.gov/oce/foodwaste/faqs.htm
- https://www.youtube.com/watch?v=4qKAse8388k
- https://www.youtube.com/watch?v=Ag2OI_xpIhU
- https://www.youtube.com/watch?v=envzev35Z2g
[1] This idea was proffered by Adam Smith in his
1776 book titled, Wealth of Nations.
[2] https://www.dictionary.com/browse/economy
[3]https://e360.yale.edu/features/global_extinction_rates_why_do_estimates_vary_so_wildly
[4]
http://www.un.org/waterforlifedecade/scarcity.shtml
[5] https://www.mdpi.com/2071-1050/8/3/281/htm
[6]
https://esajournals.onlinelibrary.wiley.com/doi/full/10.1890/14-0802.1
[7]
https://www.pnas.org/content/112/2/436?etoc=&utm_content=buffer47939&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
[8]
https://www.thevenusproject.com/faq/what-is-a-resource-based-economy/
[9] Economists might refer to this schema as Pareto Optimum.
[10]
http://www.hsi.org/issues/trophy_hunting/facts/facts-about-trophy-hunting.html
[11] https://www.youtube.com/watch?v=yZVPKbZ4cKg
[12]
https://www.thp.org/knowledge-center/know-your-world-facts-about-hunger-poverty/
[13] https://www.usda.gov/oce/foodwaste/faqs.htm
[14] https://www.youtube.com/watch?v=4qKAse8388k
[15] This, of course, requires
more than just a few pages. Peter Joseph has done a fantastic job laying out
the motivation and framework through his lecture ‘Social Pathology’ and his
film Zeitgeist: Moving Forward.
[16] https://www.youtube.com/watch?v=Ag2OI_xpIhU
[17] https://www.youtube.com/watch?v=envzev35Z2g
[18] Douglas Adams’ Hitchhiker’s Guide to the Galaxy is one of the best science fiction
books ever written!
[19] This is one of the many problem-solving
techniques one learns in a class such as Differential
Equation with Linear Algebra.
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