The End of Economic Growth Is Inevitable. Let’s Plan for It.

[BRUTE]

good answer, but it seems like a lot of effort

[Jason]

If people would just stop with all this live in peace nonsense and get back to the good old days of conducting major wars every twenty years or so, we wouldn't have to worry about this issue.

[Mister Imperceptible]

There was a pretty long period between the Congress of Vienna and World War I, just as there has been a pretty long period between World War II and now.

Here we are.

[Jason]

Umm...Cold war? Unprecedented build up of industrial/military complex? Korea? Viet Nam? Reagan build-up?

[Mister Imperceptible]

American Civil War? Smaller European conflicts? Latin American Wars of independence?....I was talking global conflicts that killed much higher amounts of people relative to total population and redrew maps.

Sure, there’s always a little war going on somewhere, including the ones in our own mind.

[Jason]

Yeah, that pesky, little Viet Nam war.

https://www.nytimes.com/2014/06/14/upsh ... rowth.html

[Mister Imperceptible]

“The frost which kills the harvest of a year, saves the harvest of a century, by destroying the weevil or the locust. Wars, fires, plagues, break up immovable routine, clear the ground of rotten races and dens of distemper, and open a fair field to new men.”

Ralph Waldo Emerson, The Conduct of Life, Considerations by the Way

https://archive.org/details/conductlife ... h/page/222

[jacob]

Wars don't materially increase death rates above birthrates. If they even move the needle, it's a brief bleep on the curve. The odds of actually dying in a really destructive war like WWII was <1% per year.

Things that do move the needle the hard way:

• Lowering lifespans. This might seem like a duh but if people start dying 10 years younger, you will see that in the population stats. In modern times this is mostly caused by bad personal habits, e.g. drinking, opioids, and obesity. Russia is a good example as are parts of rural America.
• Things like air pollution also tend to kill a lot of people (more than cars and guns ... or terrorists for that matter )---however, it does seem that when air pollution increases much more than it's currently at, humans decide it's worth paying to pare it down a little, so those numbers are baked into the cake already.
• Famines, especially if they're followed by epidemics due to people's weakened state. That's how people used to die. See much of sub-Saharan Africa. Especially Sierra Leone.
• Wars can indirectly cause both by also smashing up the infrastructure. Same deal with not maintaining the infrastructure, e.g. poor sewerage control, unclean water. See e.g. Yemen. Or NYC a 100 years ago.
• Loss of antibiotics ... or if something unvaccinable or "untreatable" becomes endemic in the population, e.g. HIV in Sub-Saharan Africa.

[technohead]

Japan is a good example of how to do it right. While GDP has been stable/declining since the 1990s, individual income has still been rising because the population is declining faster => GDP/capita keeps growing and individuals are better off even if the country is no longer expanding its resource consumption/waste production.

Human civilization is going to have to face the reality that infinite economic growth is impossible and undesirable, and will need to transform into some kind of stable state economic system.

I don't believe Japan has done that, it is in fact the earliest example of a technocrat elite playing extend and pretend via massive reserve bank intervention in the market to inflate asset prices against the huge deflationary pressure of an aging collapsing population - ie a vanishing consumer base. Its going to be a very hard landing.

Japans GDP is "stable" only in the sense that unprecedented efforts to restart economic growth have failed.

Looks like the technocrats of every other OECD country are employing this MO as they are all afflicted by collapsing debt driven consumer/worker bee demographics.

There is going to be a hard crash landing at some point.

[IlliniDave]

Widescale adoption of Soviet/Chinese-style socialism would be more efficient than war at clipping the population. Although add to that a reemergence of Nazism in a few key places and you'll really have a robust three-legged stool (Communism + Nazism + war between the two) for population decline.

More realistically, I suspect disease/famine (and resulting wars) will ultimately cause the population to crash. Much more likely than universal acceptance of living like hobbits in the Shire. Then the cycle likely starts again.

[BRUTE]

If people would just stop with all this live in peace nonsense and get back to the good old days of conducting major wars every twenty years or so, we wouldn't have to worry about this issue.

how is war good for economic growth?

[Mister Imperceptible]

Infrastructure destruction is bad in a vacuum, but war forces innovation. Necessity is the mother of invention. Right now the developed world is trapped in extend and pretend as @technohead explained.

As described in @Jason’s link, Europe’s consistent internal conflicts forced innovation. I think Jared Diamond described something similar.

[Jason]

how is war good for economic growth?

From NYT Article -

"Fundamental innovations such as nuclear power, the computer and the modern aircraft were all pushed along by an American government eager to defeat the Axis powers or later, to win the Cold War. The Internet was initially designed to help this country withstand a nuclear exchange, and Silicon Valley had its origins with military contracting, not today's entrepreneurial social media start-ups. The Soviet launch of the Sputnik satellite spurred American interest in science and technology, to the benefit of later economic growth."

Whether its war, the fear of war, the fear of takeover, external threats etc. hostile conditions incentivize innovation. Underlying the post-WW II baby boom idyllic consumerism was an underlying existential threat to our safety by a external enemy and basically explains why we ended up on the moon and undertaking a militaristic and technological build up over a misinterpretation of the events in South East Asia.

[7Wannabe5]

Claude Shannon was so oppressed by the boring work he had to do during the war years, his girlfriend during that era recalled that she had to walk him to his place of employment holding his hand every morning.

[jacob]

Eh, lets hope wars are not necessary to solve our economic problems---war is very destructive to the environment and infrastructure. Recall there were half as many people on the planet during WWII, oil discoveries (of the best kind, sweet convential crude) were rapidly rising, and electricity was finalizing its spread to the masses. Today, food reserves are much lower, resources are a lot rarer in the crust and so require a lot more energy and effort to extract because the good stuff is already gone (now sitting in people's basements and closets, otherwise landfills as junk or fly ash).

If this is destroyed by a war, humans might not be able to recover to a similar level again. Think about that. A historic analogy might be what happened to the English after the Romans left.

Also there's no techno-economic paradigm shift underway comparable to electricity or mass transportation. If anyone says "whatabout the internet", I'll note that it only employs relatively few people and that sales in smartphones peaked (for the first time) a couple of years ago. I think this is why "extend and pretend" is ongoing. Interest rates essentially regulate the redistribution rate from the rich to the poor by generating work via stupid investments and by making loans affordable so the middle and lower classes can buy things they otherwise couldn't afford like houses, cars, advanced healthcare, and pensions. In return, the rich get to pretend to be wealthy because their financial assets are valued way higher than they otherwise would be. Also see the trend of market cap / GDP.

I would keep an eye on two things.

The first is whether the internet actually can drive a new wave... right now it looks like it's reverting to an advanced form of TV being used mainly to push passive entertainment on the masses under the 1-9-90 rule. If people can find meaning and jobs and sparetime on the internet to the point of having an advanced VR rig but otherwise living in a rathole sized room with no car and no real consumption beyond basic necessities (see Ready Player One(*)) delivered via Amazon Prime, that is a viable/sustainable solution.

(*) Or with some pride, it could also be some kind of beautiful minimalism. It really depends on what kind of values people adopt. Just because we're poor doesn't mean we have to be slobs/dirty.

The second would be a new economic system or a giant reset. Note that the only class still advancing in income/standard of living is the middle-upper class (which many of you tech people belong to) and up. The rest are going sideways. You can see some of the journals with people spending a lot on ballet classes and confidence workshops for their little ones to give them a leg up and keep them in the 90% percentile. But most people don't have that. Things might snap. A debt jubilee to reset the enormous liabilities created by extend and pretend. A wealth tax (on top of the income tax) and some form of UBI in lieu of "low-interest investing". It's quite clear that nobody likes the latter---especially not the those of us who have worked to climb the ladder under another system, but we might get outvoted (in the best case) on this.

Three things ... we can also continue business as usual for a while longer. Gated cities. Doormen. Buildings with AC and pollution control for those who can afford it. Shorter lifespans for those who can't.

[Mister Imperceptible]

@Dr. Fisker

What is your opinion on the feasibility of space colonization?

[jacob]

Can humans build and maintain a base on the moon or mars? Sure ... just like humans built and maintained the ISS.

Are humans going to move en-masse to the moon or to mars to live or build factories or hotels? Nope ... just like it didn't happen in orbit.

Proof: Consider how many people live on Arctic bases like McMurdo (about ~1000).
This is a far more hospitable and easier to get to place than either the moon, Mars, or orbit.

[cmonkey]

Humans find it challenging to live in the most hostile environments here on Earth (think Antartica, the Gobi, etc..), space is orders of magnitude more hostile than that. Space colonization is never going to happen en masse barring some radical revolution in energy tech and propulsion tech, which I'd bet my entire FI fund isn't going to happen.

[Jason]

When you think about the technological advancement and subsequent economic growth interplanetary war was to George Lucas, one can only imagine the benefit when shit gets real.

[oldbeyond]

Quite a few countries have experienced years of no growth - Southern Europe, Argentina, Brazil, Ukraine, Russia, Finland. Just poke around https://tradingeconomics.com/italy/gdp-per-capita-ppp (list of countries if you scroll down).
They're outliers of course, but even now, no growth is not unheard of. And that's at the level of countries, looking at social classes, regions, age groups etc even more people are experiencing stagnation/decrease in output.

I think we already see this in young people getting room mates/living with their parents longer, trying to avoid cars, adopting minimalist aesthetics, focusing more on "experiences" and social interactions etc. I don't think it's explicitly stated or noted by most, but declining prospects and higher debt loads are probably an important driver for people assuming these preferences.

Likely we won't establish some ideal solution, but rather muddle through with duct taped solutions. We're humanity after all. Likely a cocktail of gig economy jobs, altered public policy, private sector concessions to politicians/mobs(profit margins falling back from record levels), increased skill from consumers in personal finance(lot's of low hanging fruit there), evolved cultural norms, better escapism(the masses would probably have been a lot more restive without RedTube, Playstation and Netflix, VR/AR might be even more potent), higher death rates decreasing the population making each slice bigger. Etc.