uncharted waters for sure,………………but we still need to buy a loaf of bread and put gas in the tank and turn the furnace up when it gets cold. That sputtering along thing,…..

Economists need to attend to key problems, food security, drinking water, shelter and human security/peace. For too long, we’ve hyper focused on growth with secondary concern for distribution of proceeds so that the global leader, poor majority can purchase necessities.  However, it is obvious that the effects are inequality, disruption of sufficiency, dependence on markets, homogenous globalization, environmental destruction, waste, corruption, war, dominance, coercion, institutional failure, growth homelessness and the list goes on and on.  Question remains as to who will take the opportunity in the crisis to propose economic solutions which are friendly, rather than predatory.  So far we have a box and we need to crush it, starting with the ideas, the priorities, the representation in economics by conventionalists.  No more jobs, jobs, jobs, let us incentivize a foundation in the basics, and t us have our work, our time, our autonomy, oh creativity, our freedom, our clean air, water, food, shelter, real culture, real goods not commercial garbage, let us have our dignity back as human beings. Growth, no growth, if we attain the basics we are liberated from force-feeding and stuffing ourselves with garbage consumerism.

“We must realize that growth is but an adolescent phase of life which
stops when physical maturity is reached. If growth continues in the
period of maturity it is called obesity or cancer. Prescribing growth as
the cure for the energy crisis has all the logic of prescribing
increasing quantities of food as a remedy for obesity.” ~  Physicist, Albert Bartlett

Why isnt the new book available on Kindle in the UK? C’mon Jeff sort it out please.

Just read your second book. Sobering. Really miss reading your CIBC “honest” opinions which is greatly missed from the big bank economists in North America.
 

Finished your second book, it was a good read. Too much redundancy Jeff. 
And i can’t agree with you on a lot of assumptions. But i will give you an example of some reality that i look at everyday.

We have one 40,000 square mile area with 1,700 vertical producing wells operated by 51 operators through 9 compressor stations making XXXXX amount of production. That complete area has been drilled and producing for just over 18 years specific to my point being made here.

Now, we have a 8 well pad in one (1) location all drilled horizontally and fracced and been on line for almost two years now. That small footprint has produced more production than the afore mentioned area.

What is your concept of “prudent?’

Can someone (perhaps in the know) tell me, why natural gas can’t replace much of the oil dependency? With the cost disparity, recent innovations, and big player moves towards it like Caterpillar for example, why can’t it step in to replace oil? As a primary, along with the various alt energies like solar, wind, etc. I would probably like to believe Jeff’s version of expensive oil forcing a transition from global growth models back to more local independent models, and the eco benefit of that. But I have a sneaking suspicion, oil will give way to other means and the global growth model will fight on….perhaps to a point where breakthroughs in science/tech etc will change the entire playing field in ways yet unknown.

I’m just began reading your new book “The End of Growth”.
About 30 years ago, early in my business career, I attended a national sales meeting for an industrial products manufacturing company. The directors and key executives were setting goals and projections on the implicit assumption that growth was a given.
When I naively questioned the mantra, the reaction was stunned silence. The gospel of growth was so well entrenched in the minds of these business people that my question was viewed as not only a silly uneducated comment, but almost heretical,as if i had questioned the law of gravity. Growth was viewed seen as one of those scientifically proven “universal laws” of the physical world.

I do understand that growth is necessary to ensure that shareholder returns can only be sustained if share prices and/or dividends rise over time. An increase of $7 on a $100 share (over a 12 month period) will result in a share price of $107 and a 7% ROE, however in the following 12 months, the share price needs to increase by $7.50 to maintain the same ROE. As the effect of compounding accelerates the process, the growth goals become increasingly unrealistic and unsustainable. Shareholders however are not interested in this sober perspective, and they will severly punish the management team that does not deliver.

But there are those who dared to challenge the conventional business wisdom. The following is an article by a young law student from Chicago. The article was published in Adbusters magazine more than 25 years ago. It is one of my favourite, and I believe even more relevant today.

PS to Jeff: I’m not sure of the precise definition of your term “static growth”. In a finite world, ANY year over year growth will inevitably result in collapse. We may not even be able to sustain a ZERO GROWTH at the current levels of output. 

Here’s that article…

Hungry
Ghosts

Politicians, economists and
business leaders are failing us miserably

By Mathew Joseph Medina

The
problems that our world faces – resource depletion, pollution, deteriorating
ozone and the like – all stem from a common source.  They will not be solved until we learn to
address their root cause, which is our entire way of looking at the role of
wealth in our world economy.  We must
come to realize that growth is nothing more than a quantitative measurement.  Our addiction to quantity – more wealth,
bigger houses, faster cars – obscures and sometimes destroys our more
fundamentally important qualitative goals. 
Happiness, beauty, quality of family life, spending time with children
or the elderly – many perceive theses as impediments to their addiction.  Paul L. Wachtel, author of Poverty of
affluence wrote: “ Harmony, not growth; cooperation; not individual
pursuit of more and everything; a respect for nature, rather than a ruthless
effort to conquer her; these may well be the path to salvation for modern man.”

 
The enigma of defining progress.

What is progress?  Ask
an economist and he or she will tell you progress equals economic growth.  We must continue to grow.  They talk as if growth is a qualitative
measurement.

It is not.  Roger
Terry, in his book Economic Insanity, wrote: “The only
instances of unlimited growth found in nature are cancerous tumors, they grow
by stealing sustenance from healthy tissue…and by opening new pathways for the
malignancy throughout the body.  In
essence, cancer tricks the body so that it actually contributes to its own
destruction.”  Ultimately our desire to
have never ending economic growth may prove fatal to the habitability of our
earth.  And for what?  Lets us say that we double the rate in which
we produce goods and services.  We must
then, at the same time, double the rate in which we stress the earth’s
waste-assimilation capacity.  This
capacity is not unlimited. If we dump more and more waste into our environment,
at ever-increasing rates, our earth’s assimilation capacity will soon be
exceeded.  And for what?  So we can have more stuff.  If we double our rate of economic growth,
will we be twice as happy?

 
Growth does not equal development.

Public policy ought to be focused on the pursuit of human
well-being rather than the fulfillment of endless human desires.  Material comfort is no doubt necessary to the
pursuit of human well-being, but it is by no means sufficient.  Material comfort is excess, to the exclusion
of other important human needs like community, family, spiritual and moral
development, can become an impediment to human progress.  We are often so wrapped up in the pursuit of
happiness that we forget to be happy.  We
often think that what we are doing is what is good for us.  Certainly we are doing what is expected.  Socrates taught us that we never desire
anything that we do not, at the moment of desiring it, deem to be good.  Yet, even today many people would agree (if
they took the time to think about it) that an endless pattern of consumption
will not lead to the promised land of human well-being and happiness.

When you were young, all you thought you needed was a new
bike, then you would be happy and satisfied. 
When you got older, your bike was not sufficient.  After all, many of your friends were driving
cars now.  You didn’t need anything
fancy, just an old junker to get you around the neighborhood.  Later you thought, wouldn’t it be nice to
have a new car?  After all, what would
your friends think of you driving this old junker?  If you bought a new car, then you would be
satisfied. 

Time passes.  You
think to yourself, what I really need is a sports car.  Now that you’ve got the sports car, a Lexus
would sure be nice.  This type of thought
process is, of course, endless.  Every
time you upgrade, do you feel happier? 
Probably.  However, this is the
type of happiness that is most fleeting. 
There is always something better, always something more.  I suspect that, relatively speaking, you were
no happier when you bought your first Lexus than you were when you bought your
first bike.

The personal economics of right desire.

Desires are without end because desire is without end.  The Buddhists have an instructive way of
looking at the problem of our seemingly insatiable appetites and desires.  Buddhism recognizes two different kinds of
wanting: 1) “tanha,” the desire for pleasure objects; and 2) “chanda.” the
desire for well-being.  Tanha is based on
ignorance while chanda is based on wisdom. 
In his book Buddhist Economics, Buddhist scholar P.A. Payutto
explains the relationship between “right” desire and economics:

When it comes to judging the ethical value of economic
behavior, we must determine what kind of mental state is motivating it.  When greed (tanha) is driving economic
decisions, behaviour tends to be morally unskillful, but when the desire for
well-being (chandra) is guiding them, economic behavior will be morally
skillful… From a Buddhist point of view, economic activities are not ends in
themselves – they are means, and the end to which they must lead is the
development of well-being within the individual within society and within the
environment.

I want mine now! The problem of discounting.

Many in our society seem to be indifferent to the ecological
and social consequences of our addiction to growth.  What is the reason for this?  Capitalist economic theory teaches us that
human beings are rationally self-interested. 
If never ending growth is counterproductive, and we are rationally
self-interested, why don’t we re-focus our energies for our own good?  The reason for our seeming inability to act
rationally towards growth and consumerism is the phenomenon known as
discounting.  People prefer benefits now
rather that later, and cost later rather than now.  The practice of discounting arises because
individuals attach less weight to a benefit or cost in the future, than they do
to a benefit or cost now.  To test this,
try telling a politician to support increased education funding because he or
she will see great benefits 20 years from now. 
Any given politician may or may not support increased education funding
at any given time.  But the reason for
their position, whatever it is, will have little do with the effects that
increased education funding will have on future generations.  Politicians care about the next
election.  If benefits cannot be seen
immediately, they are irrelevant.

This type of thinking is unfortunate.  The types of problems our world faces today
are long-term and complex.  They call for
long-term solutions.  The same incentives
that reward the use of short-term solutions in politics are at work in the
business community.  Chief Executive
Officers are not rewarded for the next quarterly profits.  Stockholders are very unforgiving.  They do not want to hear plans about what
might benefit the long-term health of the company.  They want profits now.  Treating workers with respect and loyalty
might cost more in the short-term, but in the long-term, loyalty to workers is
good (read profitable) for a company. 
Workers who feel secure and respected will work better than ones who
feel like expendable laboratory rats. 
This might be true, but how is treating the workers with respect now
going to make next quarter’s profits greater? 
The answer is that it probably won’t. 
Yet if the CEO fires (downsizes) some of his workers now, and makes the
remaining workers pick up the slack, payroll costs will surely go down.  This means that profits next quarter will
surely increase. 

The average person also discounts for the future.  We all consume way too many products that we
know, in the long run, will end up in a waste dump or a landfill.  We use ever-increasing amounts of
non-renewable resources, knowing perfectly well that we are stealing from our
grandchildren.  These consequences will
arise far into the future.  We want to
consume now!  Some people rationalize by
saying that advances in technology will solve our waste and energy problems.  The problem with this type of wishful
thinking is that many of the problems that we have today are created by the
very technology that we think is going to save us.

Nuclear energy is a great example.  We develop it to solve our energy problems,
and we end up with waste materials that have a half-life of  two-billions years.  We develop plastic grocery bags so we don’t
have to cut down all our trees, and we end up with bags that take hundreds of
years to degrade in our landfills.   One
could find endless examples of these good news/bad news stories.  The funny thing is that we are discounting
our future to obtain products, that even in the short-term, do not make us any
happier. 

The concept of economic growth for the sake of growth had
indeed risen to the level of a full-blow ideology.  The result of this trend has left us with a
society that exalts consumerism and economic efficiency over all other
values.  We have become “hungry ghosts”
whose sole purpose is to consume, produce, consume and produce more.  The only thing that matters is more.  The quantitative has supplanted the
qualitative.

Politicians, economists, and business persons are in the
best position to help society chart a different course.  They have failed miserably.  Politicians, like us all, discount for the
future.  Economists champion economic
efficiency over all our values.  Accordingly,
they too help contribute to our crises of perspective.  But most of all it is us who are to blame,
average citizens.  What we need is to
begin asking the right questions of our leaders.  Instead of asking, “How can we grow
faster?  We need to ask, Towards what
end are we growing?  Instead of
asking, How can we be more efficient in business?  We need to ask, Toward what end does
business serve?  Instead of asking, How
can we increase our income so that we can consume more?  We should ask ourselves, How can we
avoid becoming hungry ghosts?

Matthew Joseph Medina is a 28 year-old attorney who works
in the field of public interest law.  His
is currently working on a masters degree at the University of Chicago.

The three bronze cast sculptures were created by Ronald
Garrigues.  Born in San Francisco in
1930, Ronald Garrigues has had innumerable exhibitions of his work.  Since 1990, he has turned to using the stark
metaphor of the skull, which he believes contains beauty but implies
foreboding.  For more art by Ronald
Garrigues visit http://www.sculupture.org   

Just read “The End of Growth” and loved it. 
We should embrace zero growth.  Remember what Henry David Thoreau said about 150 years ago. “Most of the luxuries and many of the so called comforts are not only not indispensable but a positive hinderance to the elevation of mankind”. 

Currently in the Bakken area of North Dakota, the oil companies are now creating 2560 acre (4 section units).  They contain 4 vertical section units (North/South) and 6 wells (East/West) – which are located in the middle of the 2560, Each of these 6 pads wil have 2 holes drilled.  One horizonal lateral going North and one horizontal lateral going south.  This in effect, gives you 12 wells for the 2560 acre unit.  It is very effecient because with all these laterals you are draining the unit of the currently recoverable oil.  Of course, in the Bakken since your are getting only 6% of the oil (due to the porosity) that means there is 94% of the oil left in the ground.  What technologies will extract more?  Who knows.  You probably know much more than I do about oil – and you might even already know the process I just would describe it anyway.

This technology (fracking) has changed the game quite a bit.  If we pursue it in the other oil shale regions aggressively, we could in mininize our reliance on foreign oil – if not eliminate it completely.

Of course, we will have to learn to deal with all the earthquakes that all this extraction will cause.