Hence, the Herman Daly Question: If the economy is a subsystem of the biosphere, and the biosphere has limits, why do we organise economic policy around the assumption that growth can continue indefinitely?
Well, I actually had this discussion with Daly himself. In which I pointed out that GDP is value added, growth in GDP is therefore an increase in value added and that – therefore – the ecology is not the binding limit upon economic growth. Knowledge of how to add value is. His response was splutter.
I did not come up with that point, obviously, it’s just the standard economic point to make about it.
Sure, sure, the number of copper atoms on the planet is a – large – fixed number so there’re only so many copper atoms we can use while remaining on this planet. So, sure, the environment produces a limit for us. As does the supply of fresh water, the temperature, the existence of bees and so on and on. They are indeed limits to growth along certain axes.
But they are not the binding limit. As we can actually derive from Daly himself. Imagine we achieve that steady state economy – which he defines as one in which we do abstract new resources but only as a sustainable rate. OK, does growth therefore cease? Nope, it continues to grow at the speed at which we gain new knowledge about how to add further value to whatever limitation of resources we face.
Economic growth is dependent upon knowledge, not resource availability. Therefore resources availability is not the binding constraint upon economic growth.
Daly distinguished between growth and development. He argued that growth means an increase in the physical scale of the economy, involving more extraction, production, and consumption. Development, however, means improvement in quality, requiring better technology, better organisation, and greater wellbeing without necessarily expanding material throughput.
All Daly has done is insist upon the same thing as standard economics. Which I pointed out to him and the response was splutter.
Imagine my surprise at Spud not getting this.
I’m naturally thinking of Artemis 2. And all the physical resources of the moon.
Of course they’re claiming the next place to go is Mars. Which is a lot bigger than the moon.
I don’t see a whole lot of mass being shipped from Luna to Earth in the near future.
Even with Starship in its final configuration, and even though shipping it requires less energy than the other way, it will still be very expensive.
Just the energy alone is several times more than moving it from Sydney to New York City. Sure, there’s stuff that moves that way today.
Most of the stuff extracted on the Moon is likely to be used on the Moon to build more stuff. Cargo that comes back is likely to be light and expensive per kilogram. Probably on the same order as gold at first. And it will be stuff that’s much cheaper to make there instead of here, so it’s probably stuff that isn’t being made now at all.
It probably will be uneconomic for the foreseeable future to send minerals, or even manufactured stuff, from the Moon to here. However it’s a lot easier, energy-wise, to get stuff off the Moon’s surface and on a trajectory to Earth than it is the other way round, but you do need to be able to manufacture the fuel for it on the Moon. 14-day days helps though with solar panels.
He³ – conceivably!
But we don’t need to ship anything physical to Earth to boost GDP, a thriving economy within the Solar System would boost the total human GDP.
Not He3. Aluminum and oxygen. The moon is abundant in both and with solar panels to provide the power to separate the AlO (so that it can be recombined in a rocket) and you have plenty of oomph to get things back to earth.
And that’s ignoring linear accelerators.
If they get fusion up & running, Helium³
As Chris beat me to it, a while ago.
I have got the limits to growth thing…Surely, we can have growth where we use the same amount of a natural resource more efficiently, creating more x for a given amount of F. And then there’s recycling of given resources…
I have *never* got…
The limit is when the economy becomes so large that it literally contains ever atom of every element.
Because that is a real limit doesn’t mean that we’re anywhere near close enough to achieving it. Der Taterfueher does not understand (again, his primary problem is his ignorance of what he talks about) that because that limit exists doesn’t mean we’re in a position to need to curtail growth *now*.
But he has to misunderstand this – his whole identity and a significant portion of his income rests on him not understanding it.
The difference between 300 years worth of a resource and an infinite amount is near effectively nil.
The world will run out of oil by 1970!
The world will run out of oil by 1990!
The world will run out of oil by – Oh shut up!
Confusing the number of molecules of stuff in a place versus the number that we can retrieve and sell using today’s techniques at today’s prices.
Always a fun ride. And profitable too! After all, Ehrlich didn’t die a pauper.
Spud is lefty and as we know the only way socialist and communist regimes grown is through devouring more resources, so he projects that on to classic economics.
…
Theres only 200 years of oil, gas and coal left, you need to shiver in the dark!
“Who is Herman Daly?” thought I. Wiki tells me, among other things, that ‘In 1996, he was awarded the Right Livelihood Award for “defining a path of ecological economics that integrates the key elements of ethics, quality of life, environment and community.”‘
Ecological economics, FFS.
Never mind intelligence, or the need for meaning, or all the other bollocks. The thing that distinguishes humans (and perhaps some other Homos) from other species is our large-scale use of resources for which we don’t have to compete with other species. Fire, wood, stone, metals, hydrocarbons, rare earths.
They are what make us rich, rather than competing with other species for the same finite resource, as the magpies in my garden do with just about everyone but pigeons.
So WTF does this resource use have to do with ecology, other than causing some environmental damage which responsible (i.e. capitalist democratic) countries often put right, and communist countries rarely do (Aral Sea, Karen mountains in Burma, etc. etc.).
And there’s the problem. It’s the hated capitalists who do the right thing. What you’d expect from a fair capon lined World Bank bigwig.
“The thing that distinguishes humans (and perhaps some other Homos)…” Owen Jones?
“Only three people have ever really understood the Herman Daly business – the Prince Consort, who is dead – a German professor, who has gone mad – and I, who have forgotten all about it.”
I thought you might have said an ‘Ely Professor, who has gone mad’ (Which is true) – only to realize
So understand why you chose to echo the quote on Schleswig – Hostein
Yeah. No need to participate in his delusions.
“This series has been produced using what I describe as directed AI searches to establish positions with which I agree, followed by final editing before publication”
In other words “AI, tell me what i want to hear”.
the guy really is a bell end.
You seen his latest post on Scotland – talk about desperation!!
‘Please bung me £20 a year for an SNP propaganda broadsheet which is about the only publication (outside the BBC and the Daily Mirror) still willing to entertain my analysis’
You can be a bloke with a BTEC from a technical college, not a professor for decades to get this.
Streaming a movie uses a shitload less energy than driving to Blockbuster Video to get one. Yeah, servers use a bit of energy, as does your streaming box, but it’s nothing like burning petrol to get one, making DVDs, moving them around. And DVDs were better than VHS tapes because VHS degrades with each playback, so have to be binned after 30 rentals.
Airlines use computer technology to automatically adjust flight prices, optimising use, filling planes. This has led to an increase in passenger load factor compared to decades ago.
Haulage companies use GPS and mobile comms to do pickups en route, maximising the use of vehicles.
Red light districts have disappeared and it’s all on the internet now. No wasted trips for blokes driving around looking for an available slapper and realising it’s just the trannies left.
Replacing wine corks with stoppers reduced the number of bad bottles being destroyed. Shipping wine in giant vacuum bags in shipping containers that are bottled in the UK reduced the energy to ship wine (doesn’t work with sparkling but if you could in theory bring grape juice over, ferment, bottle, secondary ferment here).
OT but a ‘video rental’ (DVD) shop has just opened on the high street of our nearest town. Is this a retro thing like vinyl? This is in leafy Bucks, not Toxteth! It did cross my mind that it could be ‘speciality’ videos, but surely not 🙂
https://playbackvideo.co.uk/
I saw that asked in one of those televised London dinner party shows. The guests were asked to choose a wine with the lowest CO2 footprint from a choice of Italy, Spain and Australia iirc. Their jaws dropped when they were told Australia just edged it as no bottles were physically shipped here.
The glass bottle (production and shipping) is most of the CO2 of a bottle of wine. Growing grapes is CO2 negative, and the energy in the winery isn’t much per bottle. It’s greener to use some form of plastic because of the weight reduction, and one bloke has invented a bottle that is quite flat, so you twice as many on a truck in the same space.
https://www.therealreview.com/2022/07/14/accolade-and-taylors-launch-environmentally-friendly-plastic-bottle/
There’s possibly a benefit to glass for long-maturing wines, but for something you’re going to drink straight away, plastic is fine.
What so special about that? I’ve been buying wine in cartons since the 70s. And since the paper has a plastic liner. it’s no different from a plastic bottle & a far more efficient shape. Shame they don’t really sell wine boxes here. France, you could get some decent boxed wines. They’re the perfect answer if you’re an every day drinker.
If I buy wine from the local pub, I always buy the boxed stuff.
It’s cheaper.
That’s a fair point. I’m fine with wine boxes, personally. There’s a shift towards them getting better wine now. The Wine Society sell their own label White Burgundy in a box, which is a lovely wine, I’d say better than everyday. Normally costs about £12 a bottle.
I often enrage my fellow farmers by pointing out that much imported food has a lower per kilo carbon footprint (if you consider such things important) than UK based produce. Tomatoes flown in from Spain produced in naturally heated greenhouses are lower carbon than ones grown in heated UK glasshouses, even after the jet fuel used. Lamb from NZ produced in temperate conditions (ie can live outside and eat grass all year round) beats UK sheep that need to be housed inside or fed concentrates in winter. Ditto beef from the Argentinian pampas. Etc etc.
They don’t like this 🙂
Given the way the oil mess is making Albo run around like a chook with its head off here in Oz, I’d not recommend you Brits rely on foreigners for all your food just yet.
AI says: The per capita mass of the Earth, which represents the total mass of the planet divided by the human population, is roughly 750 trillion kilograms per person, based on a population of 8 billion and a total Earth mass of \(5.97 \times 10^{24}\) kg
Which kinda puts it in persepective. My 750 billion tonnes should see me out. Herman might have a position but it is completely irrelevant in the scheme of things. Anybody who thinks this ‘question’ represents a basis of a scheme for economic success is not operating in the realm of reality.
Herman Daly (1938-2022) spent much of his career challenging one of the central dogmas of modern economics: the belief that continuous economic growth is both possible and desirable. Working first within mainstream economics and later helping to establish the field of ecological economics, Daly argued that the economy cannot be understood apart from the physical systems that sustain it.
‘A specialist in straw men’. I have often said that Murphy’s output resembles that of an ‘A’ Level student. It seems Daly was in this vein also.
Hence, the Herman Daly Question: If the economy is a subsystem of the biosphere, and the biosphere has limits, why do we organise economic policy around the assumption that growth can continue indefinitely?
What I like about this is its equivalence to the kind of ‘dogmas’ that he condemns from what he perceives as ‘conventional’ economics – it’s as though everything is preserved at the point he is writing. No technological changes or changes in systemic thinking have occurred at any point which might perhaps enable a new model of resource capability?
‘Daly argued that economics had become detached from the physical realities on which it depends. Production requires energy, materials and ecological processes. Waste must be absorbed somewhere. These flows are governed by the laws of thermodynamics, not by market preferences.
Yet economic models frequently assume that technological innovation or substitution can overcome any resource constraint. Daly did not deny the importance of innovation, but he insisted that physical limits cannot be wished away by theory.
Kudos to the always excellent Esteban for pointing out an example of how fatuous this level of ‘insight’ actually is -in fact while not being an econometrist myself I’m fairly sure Macroeconomists take into account the potential limits of technological change in any number of models but of course such an approach, based on a level of mathematical understanding well above my own can’t beat his and Gary Stevenson’s ‘economics of the corner shop’
Daly distinguished between growth and development. He argued that growth means an increase in the physical scale of the economy, involving more extraction, production, and consumption. Development, however, means improvement in quality, requiring better technology, better organisation, and greater wellbeing without necessarily expanding material throughput.
This distinction is crucial. Growth cannot continue forever in a finite system, but development can. Daly, therefore, argued that mature economies should shift their objectives away from expansion toward qualitative improvement.
The goal should be a steady-state economy in which resource use stabilises within ecological limits.
I think North Korea acts as a perfect laboratory for this ‘steady state approach’ – and it’s a country that is among the poorest in the world where people swim a polluted waterway risking capture and death to escape it. Most people would shy away from such a set-up but not the ‘Sage of Ely’
Basically boiled down I don’t need to be as eloquent or direct as another legend, Gamecock to summarize the basic message.
Unless all resources (that’s financial, human and physical) are placed under his direct control then we’re doomed. One wonders if he is in fact Human? One problem with AI (and anyone who has used Claude will see this – for now mercifully he’s on ChatGPT I think) is that it gives the illusion of expertise. That’s never truer than with this guy.
“So, I understand you’re a supporter of degrowth…”
“Yes – I believe we should use the Earth’s resources more efficiently”
“You realise that’s literally the definition of growth right?”
“Daly distinguished between growth and development.”
Which together make up what we usually refer to as ‘economic growth’.
Murphy sometimes uses that technique too; make a sweeping, incorrect statement, then redefine your terms in an attempt to justify it.
Sometimes?
Herman’s problem is he sees resources as having value & thus part of the economy. Where of course they aren’t. The value of the pearl is not the oyster forming it but the finder finding it. The value of everything is value added. So there can be no limit to the value can be added. You can add value to a pile of rocks simply by moving them from here to there. The added value being they’re there not here. Still the same rocks.
Something he doesn’t consider.
The biosphere is so diverse because over time organisms evolved to take advantage of resources that others can not – organisms make things that were not resources into resources.
They also evolve to use resources more efficiently. If this were not the case then the ecology would just be a planet full of primordial slime.
A market is just evolution in action.
the ecology would just be a planet full of primordial slime.
That wouldn’t preclude socialists & university professors existing.