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Thursday, November 27, 2014
Economics/Business ... Politics ... Society ... Technology ...

I’m going to discuss three “big thoughts” from three different thinkers, as to see if there’s a common thread in them (or at least a common question that lies at the heart of all of their concerns). We can start with this: on the surface level, they all relate to “the state of human civilization, and where its going”. As to how they might relate to today, the American celebration of Thanksgiving — I will leave that to the reader.

The first big thought is from a Teaching Company audio lecture course that I recently finished. The course is presented by Professor David Christian, and is called “Big History” (appropriately enough). At the end of Professor Christian’s sweeping review of the highlights from the 13.7 billion years of our Universe’s existence, he presents a dilemma regarding the future. A rather large one. And that dilemma is this: according to the U.N., the world’s human population is to peak around 9.2 billion in 2075, then slowly decline. If between now and the, all of those people were to adopt a modern western lifestyle, we would need around 3 or 4 Earths to provide sufficient resources to support such a global living standard. Unless something comes along that makes “the good life” a whole lot less energy and resource intensive, it seems quite clear that not everyone is going to get to enjoy the conveniences and comforts that most Americans take for granted. Perhaps less than half of the world will ever be able to achieve it.

Therefore, there will continue to be a division between the haves and the have nots. Probably an increasingly wide division, as the educational requirements of a high-tech world raise the bar for getting in on the good life. And that, according to Christian, is going to fuel continued terrorism and war; mostly on smaller scales, but possibly on continental or even global scales (such as experienced in the first half of the 20th Century). Technology is making it easier for small nations and non-govermental factions to gain access to highly potent weapons, perhaps even weapons of mass disruption and destruction (atomic bombs, biological weapons, cyber terrorism, etc.).

Can technology save the world from the approaching calamity that it is otherwise fueling? Despite his solid academic credentials, Christian is not entirely down on capitalism, despite its clear hand in causing the many problems and inequalities that we face. If more technology is the only possible way to address the resource and wealth distribution problems that threaten us, it is important to remember that capitalism has historically been the best motivator and driver of technology. Professor Christian seems to conclude that the world might yet find a way around all of the gloomy stuff hanging over its future; and capitalism, the source of much of the gloom, might yet help to dispel it (IF it can be coerced through profit incentive into saving the planet).

By comparison, Pope Francis (my second “big thinker”) is not as optimistic about the role of capitalism in human society. In a recent papal exhortation, the Pope said that modern global capitalism is responsible for “a new tyranny” and a process of dehumanization. He called for “a generous solidarity and the return of economics and finance to an ethical approach which favors human beings”. Unfortunately, he didn’t spell out in much detail just what he had in mind to take the place of free markets and profit / welfare maximization for consumers and investors. I would suppose that he wants businesses and investors to “slow down”, to give more wealth away and forgo future wealth so as to benefit the poor and the laborers, to make enough to get by but not to become extravagantly wealthy and powerful. “The culture of prosperity deadens us”, says the Pope; perhaps that’s true, but that hasn’t yet stopped most everyone alive from striving for it. Nonetheless, give Bishop Bergoglio credit, as he himself was able to forgo the luxuries afforded to the Papal office. He is to be admired for his own Francis-like humility.

I have no doubt that the Pope’s vision would make for a much nicer world to live in. But I can’t help but wonder, with regard to all of that new technology that Professor Christian thinks is needed to keep humankind from coming apart at the seams – would it still be developed? Under “Franco-nomics”, the rich wouldn’t be so shockingly rich anymore, and the poor would have a few more things to help them get by. But there the rich would still be rich and the poor poor; and the poor would continue to vastly outnumber the rich. And it’s possible that the rate at which people have left poverty throughout the world over the past 20 years or so would slow down or stall completely (remember that about 1 billion people moved up from below-subsistance poverty levels during that time, thanks largely to dirty old carbon-fueled economic growth in China, India, Brazil, etc.).

As to global warming . . . without capitalist incentives, who would perfect low and non-carbon energy sources and energy-efficiency improvements? Socialist economies were never all that good at innovation, and governments only get tax support for vigorous research when military survival is on the line (as in the USA in the 1950s and 60s). Unless “undoing the deadening culture of prosperity” means living without air conditioners and shivering under blankets all winter, the current carbon-reliant economy would not suddenly disappear (nor even shrink in any significant amount).

Speaking of global warming, my third big thinker thinks that global warming “changes everything” about capitalism. Naomi Klein has just published a book called “This Changes Everything: Capitalism vs. the Climate”. Ms. Klein doesn’t buy the notion that there is a technology-fix to global warming, however green that fix might be. She feels that radical economic and political change are needed. And as to our livestyles and ability to stay warm in winter and avoid the torpid swealter of summer? Perhaps that won’t need to be impacted, but can’t rule it out. At all costs, capitalism has to go, per Klein – it is the main driver of global warming, and it’s now making the planet uninhabitable. We’re going to be better off without it.

What will take its place, and still allow the levels of innovation and economic growth that support our current lifestyles? And how to go forth to share them with the entire human race? Her answer is this: something called “regeneration”. Ms. Klein describes it enthusiastically: through regeneration, “we become full participants in the process of maximizing life’s creativity”. Sounds great, but she doesn’t offer many details as to just how the process of shutting capitalism down and flipping on the “regeneration” switches would work. Thus far, regeneration is more about what it is NOT than what it IS: i.e., it is NOT about depletion and domination. Fine, but how do we all stay warm in winter and avoid the summer swealter, and still have affordable smartphones and movie streaming?

In the NY Review of Books’ summary regarding Klein, the reviewer mentions a manifesto for the ecological future called the “2000 Watt Society”. The 2000 Watt idea is to limit everyone in the world to the current daily energy expenditure per capita: 2,000 watts. Just about every citizen in the developed nations exceeds this average: for Americans, the average is about 11,000; Western Europe weights in at around 6,000. Of course, in the developing world, the average per capita energy use is a good bit lower than 2,000. The idea is to achieve global equality, and to limit the portion of the daily allowance coming from carbon-based sources to no more than 25% (or about 500 watts per day).

I’m sure that over time, the western nation averages can be brought down through technical efficiency; but as to actually adjusting life-styles, as to eliminating things like air travel and universal indoor climate control and big-screen entertainment technology everywhere you look . . . even getting Americans to give up their beef and chicken and pork to save a few hundred watts would be like pulling teeth. And more a lot more SUV’s and “crossovers” are sold at car dealerships (about 4.7 million in 2013) than hybrids and pure-electric vehicles. (around 595,000 per year in 2013).

The problem unique to America is that reducing our energy and carbon footprints significantly would require a living style that is much more inter-dependent. We will have to increasingly rely on public transportation and Uber-style sharing of vehicles, for example. We will have to live in apartment or condo-like clusters in densely populated urban areas. This works fine for some people, but a whole lot of others get upset about having to rely on other people so much. The “triumph” of the American way of suburban life has been the maximization of independence; i.e., I can buy what I want whenever I want it, I can paint my house whatever color I want, I can drive wherever I want whenever I want to go . . . American’s aren’t going to be easily talked into “regenerative economies”, no matter how participative or creative they may be.

It seems to me as if we’ve gone too far to turn around at this point. We are moving too fast to jump off the society and economy that we’ve created. Like it or not, just about every American is locked into a way of life driven by capitalist investment, free trade, and carbon-intense energy technology. Too many Americans do not get a fair deal from this economy, inequality abounds; but an amazing percentage are living fairly comfortably because of it, even if they occasionally become resentful at the opulence allowed to ‘the 1 percent’. It would take several generations and a lot of disruption (and possibly protests and violence) to change the fundamentals of our system at this point.

And “green technology” itself will not revolutionize the economy; green energy does not necessarily empower the poor. My prediction: once green technology becomes a clear money-maker, it will be 90% owned by the 1%. Don’t forget, once upon a time, say around 1910, the automobile industry was in the hands of a large number of small, local venture capitalists; the big money stayed put with railroads, trolley companies, boat transportation, etc.

Perhaps the best we can do it to use our individual and collective voices (governmental, faith-based, civic association) to demand that capitalists find a way around the twin time-bombs of global warming and distributional inequity. I’m thinking of carrots and sticks here; regulations and penalties for unhelpful acts, but incentives that make money for positive steps (especially in the green energy realm). Perhaps Professor Johnson, with his “big history” perspective, can see the overall quandary; whereas those such as Pope Francis and Naomi Klein, who are people of the moment, have a harder time facing up to it. The best we can do is to hope that capitalism can pull things out of the fire in the nick of time, without too much collateral damage (but collateral damage there will be, in addition to all the damage already done!). After that . . . it’s a roll of the dice. There’s a bullet in one of the chambers on the gun that we’ve put to the head of Gaia (Professor Johnson incidentally does a nice job of explaining the Gaia hypothesis), and we’re no doubt going to spin it and pull the trigger . . . Naomi Klein and Pope Francis notwithstanding.

Enjoy your Thanksgiving!

◊   posted by Jim G @ 2:23 pm      

  1. Jim, Well, I’m not sure how to respond to your “Enjoy Your Thanksgiving” at the end of your post. Should I worry about if the sky is going to fall, according to your thinking about the coming times?

    Then again, there were so many people had a “sky is falling” Thanksgiving, it may be difficult to find a “happy” part about Thanksgiving for some people.

    As I see it, there are a couple (or three?) big “problems” in Prof. Christian’s 13.7 billion year idea of the universe: First, the “If” at the beginning of his concept about all the people adopting a western lifestyle. “If” something happens often means to me that the likelihood of it happening is small.

    Second, does he seriously think that “all the people” in the world might even for a second adopt a western lifestyle. From what I’ve read of both history and novels, I doubt that the Asian countries and the Middle Eastern countries particularly, and lots of them in between those two (Ukraine comes to mind here), would seriously consider adopting a western lifestyle. Sure, they might want some (a lot) of the things we have; but they only want them if they can adapt them by changing, tweaking them to fit the lifestyle and culture they seriously love and revere. Just because they like some of the western “stuff” does not mean they want to throw out their own culture. Over the years I’ve been amazed how much culture is imbedded in individuals, all unbeknownst to themselves (except often when they come in some type of close [by which I mean friendship/love] kind of contact with a person of another culture; then the culture inevitably shines through on all sides involved. (I could give a couple of examples here, but I prefer not as should be obvious from the previous sentence–—too much person info might be revealed.)

    Third, I find myself wondering just how Prof Christian can be so sure the sky will be falling if the universe has already survived 13.7 billion years. *And* in that whole process it evolved to quite an extent, I’d say. Thus, if it can survive the past, why not the future?

    As to Pope Francis: I think he’s got a point in criticizing Capitalism. My view of his point is a bit different from his, tho. As I’ve said before, I wonder what an economy based on cooperation (we all work together to win) instead of competition (somebody’s got to lose) would look like. I wonder if any serious economic thinker (which I am not) has ever tho’t of the concept of an economy based on cooperation. I myself wonder what it would look like, what the bad aspects of it might be, what the good aspects would be. I’d like an “out of the box” economic thinker putting some tho’t into an economy based on cooperation in the hopes that Pope Francis’ idea of a better lot for the 99% might come to a realization.

    And as a tangent, (can’t forget my tangents) in the whole Capitalistic system there are way too many people, even for the 1%) that just have too much money and no clue what to really do with it. Ever watch “Million Dollar Listings? I think that’s the name – the program with all the guys/gals (one woman) selling some major real estate for millions in cash, “close in 5 days, cash only” type of thing. These are people with discretionary spending money that far exceeds anything I could ever dream of. And then there’s Michael Jordan’s how many million dollar house in some suburb of Chicago, which has been on the market for years, I think; seems it was built for a “Michael Jordan type” basketball player . . . and how many of those are there who want to live in a Chicago suburb? Seems there are none as he can’t sell it, so far, at least. I seriously and badly digress.

    As to global warming: I think, that with the winter we have this year, this should be given a “re-think.” Maybe it’s a fluke that all the cold air is sliding over the North American continent; maybe Europe, Russia, and all of Asia are experiencing the “warming” trend. Yet, so far, I find myself urging those who worry so about the “warming trend” to give it some further tho’t. Maybe it’s just Mother Nature in all her “Gaia-ness” feeling a little moody in how she arranges what countries get what kind of climate.

    Then too I read that for some strange reason (Mother Nature’s “Gaia-ness”?) the South Pole has been accumulating snow while it is *only* the North Pole that’s been melting. So it seems that maybe the “warming trend” is peculiar to only particular places and not the entire world. Perhaps Nature is just shifting where it puts the warm and the cold.

    And in the end hope your Thanksgiving was good and that the rest of the holidays will be happy and “clement” for you and yours. MCS

    Comment by Mary S. — November 28, 2014 @ 3:31 pm

  2. I would agree that the income distribution between the wealthy and the poor will continue to widen – largely because of robotics. In the short term, the government can impose a more progressive tax system, but it is unclear whether this would cause capital in the long term to move to countries with a less progressive tax system. If so, then some form of socialiam ia probably the long-term answer.

    I have not read Naomi Klein’s writings, but with regard to the environment, it seems that countries have a prisoner dilemma problem – ie, what any one country does has little impact on global warming,so each country doesn’t have the adequate incentices to control emissions. Thus relatively little gets done. This problem is worsened by the fact that global warming actually benefits somwe countries (Russia comes to mind). For the short term at least, the solution seems to me to use tax policy to penalize the global warming polluters.

    Comment by Zreebs — December 3, 2014 @ 1:19 pm

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