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Money as Debt is unsustainable in a world of finite resources.

I know I'm entering a hornet's nest here, but this argument has always bothered me. First, I guess that with "Money as Debt" you mean that our current system needs growth. Loans are taken and must be repayed with interest, which requires growth, or the whole thing falls down. And yes, the world is a finite place.

But you can have different kinds of growth. Extensive growth means exploiting new resources. This cannot be done endlessly in a finite world and will eventually have to come to a stop. Second, you can have intensive growth. which means doing things in smarter and more efficient ways. Examples here might be better ways or organising production, making more of a product with the same input (or the same amount of product with a smaller input) through the use of better technology, or the discovery of an entirely new resource, earlier thought useless, that can be utilised (think uranium in the 20th century).

So, eventually we will reach the end of extensive growth, and possibly even reach the end of intensive growth, if we can't keep innovating fast enough. Growth will then have been shown to be unsustainable. But no one has any idea when this will happen, if it indeed will, so until then we might as we'll sustain our growth, which has made and is making the lives of humanity so extremely much better.

If or when we reach the end of growth and is seems it no longer can be sustained, well, then we'll deal with it. For now, making the system better is a far better idea than changing it fundamentally. Reform rather than revolution.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Sat Jan 26th, 2008 at 07:00:32 AM EST
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I understand your argument, and it is a good one.

Money as Debt is one driver of Growth: and it is possible to imagine scenarios where "intensive growth" - built upon whatever base we are about to plumb - sets us off on a more sustainable course for a while. That is what the Kondratieff Wave is all about, as I understand it.

But the sticking point is "the Corporation". The Cooperation and transparency that is, I think, necessary for "intensification" is programmed out of Corporations in favour of "Commercial in Confidence" and the great God of "Competition" (and don't get me wrong, I'm all in favour of people competing on Quality).

The other "driving force" in the economy is the drive for "Profit" (which is, IMHO, almost by definition, one of the root causes of inflation, Money as Debt being the other). Until you replace the Corporation and a "Profit and Loss" economy with something better, then "intensification" will be difficult, if not impossible.

Within a Partnership there is no "Profit" and no "Loss", merely creation and exchange of Value ("Money's worth") in all its forms - and deficit "Money as Debt" is not Value, but a claim over it. People collaborate and share information etc in a Partnership, because they share in the gains if they do.

One of the best illustrations of the negative effect of Corporations - and the instiable appetite for Growth in Profits - is in the UK right now, where, because we have privatised Gas and electricity supply, our energy policy will always be directed down routes which do NOT lead to reduced energy consumption.

Reform rather than revolution

I prefer transformation.

The system cannot be reformed from inside.  But, as I bang on about on ET, I believe that partnership-based alternatives are emerging to the dinosaur Corporations, and that if they do not use such collaborative models they will be "out-competed" by those who do.

It's because they have the "Cooperative Advantage" of not having to pay returns to rentiers.

In a networked society there is no place for intermediaries. The defining moment of the necessary transformation is the ongoing collapse of the financial system and its transition into something else.

IMHO that will occur during the next four years. Maximum.

Napsterisation happens fast.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sat Jan 26th, 2008 at 07:46:13 AM EST
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